Learning the secrets to bank mergers from proxy reports.
Does the bank rally stall? Reading Warren Buffet's letter this past weekend, bank investors might wonder why Berkshire's investment heads dumped so many banks near the bottom. After all, banks are not far behind airlines and wildcatters in line to benefit from re-opening. Berkshire gave up 20% outperformance in the process: Large Financials (yellow line)… Continue reading Nice rally banks got there…shame if something were to happen to it.
The friendly folks at Goldman recently ran a regression of which sectors do well with rising rates. If you can't read the chart below, rising rates are bad for stocks in the consumer, utilities, and software sectors, while they tend to support energy and financial services. To answer why, rising rates often coincide with stronger… Continue reading Financials outperforming tech? Yes it can continue.
We'll skip the Charlie Munder quotes; it's broadly apparent that we live in different times: US Debt: Inflation is the Only Way to Manage It (Treasury Dept) Nervousness is rational: Normally we don't see policymakers launch gargantuan, two-pronged stimulus 6 months after a 30% quarterly GDP growth, but election promises are promises, and voters on… Continue reading Tools for Financials Investors Nervous About Inflation and Rates
Improve portfolio growth by avoiding the "clones" Owning typical banks can be a losers game. Most banks compete on price, fight low rates, and miss out on innovations like digital currencies. For these reasons among others, regional banks have lagged the broader markets over the past 5 years. But among the 800 publicly traded banks,… Continue reading A Tool for Outperformance: Finding Great Businesses Hidden Inside “Boring” Banks