I guess today we “Took it in the shorts” (I sure did). It’s amazing how those bank stocks jumped up in price. Wells Fargo raised their dividend 2¢ and the stock rose $7. I guess since the Sage of Omaha owns a lot of it, people are running scared. The guy's not dumb, the stock's a dog and raising the dividend is a John Paul Jones move, only I ain't the Seripis.I’m glad Buffet didn’t raise the dividend 8¢, I might have been sold out! Fannie Mae up $2 and Freddie up $1.50, some real value there! Maybe just a lot of short covering.
I can see Fannie and Freddie jumping around a bit, once you get under $10, you are day-trader-fodder.
The SEC has restricted naked shorts (this doesn’t affect the average trader shorting with local brokerages; they are loaning you the stock). The restrictions apply to primarily hedge funds. The 19 stocks on the list are: Fannie Mae, Freddie Mac, BNP Paribas, Bank of America, Barclays, Citigroup, Credit Suisse, Daiwa Securities, Deutsche Bank, Allianz SE, Goldman Sachs, Lehman Brothers, Merrill Lynch, Morgan Stanley, Royal Bank, HSBC, J P Morgan, Mizuho Financial, and UBS. Hedge funds are the target of this restriction.
Do you get the idea that a lot of people think that something is wrong with these stocks? Is it wise to own stock on this list? I guess the real question is; do you think any stock on this “Do not short list” is going to prosper in this market and make you money?????
The banking system is pretty much toast; its running from its own shadow. Senator Schumer proved it by pointing to one bank and it dropped dead in 11 days. That bank probably had another 18 months before it would have been a problem child, now we will never know.
The point is, we have a panic in progress. Did we stop it today by banning hedge fund shorts???? Banning shorts has never worked in the past. Do you get the idea that the world you knew is not the world you see now?