Supply is increasing. Demand is stagnant. Price must go down. The BAC, C, and WFC secondaries totalling $50B is a ton of supply. This is on top of the insider selling that continues to substantially outweigh insider buying. The retail investor is not coming in to load up on overpriced stock inventory like it usually does. There have been almost no net equity inflows into funds this year. Once bitten, twice shy.
Its funny, C is priced at around $3 but its market cap is almost $100B! And WFC's market cap this year is the highest it has ever been. Dilution eventually catches up to stock prices. I am bearish on today's trade (expect a sell of the gap down), due to a combination of anticipatory pre-Fed buyers unwinding positions, lack of bears, dollar's Hulk imitation, and overbought readings.
Posts
2 comments:
LONG ZLC @ 2.61
-OL DAWG
Dawg you forgot that WFC bought Wachovia, which was in itself a huge bank.
I bet JPM also has the highest mc after buying WAMU.
All these surviving banks are just bigger fish now because they swallowed the smaller ones.
Post a Comment