Friday, February 20, 2009

Nationalization of Citigroup (C) and Bank of America (BAC) Beckons

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Hi Tim?

Yes, Sir?

Get the troops ready - it's going to be a long Sunday. We're gonna need to "fix this" (squeeze the shorts) before the Asian Markets open. You know the drill right?

Yes, Sir!

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Rejoice taxpayers of America - you will now have two new banks as part of your Fannie/Freddie/AIG/Bear portfolio. Inside Bank of America (how appropriate this name shall soon be!) alone are all those Countrywide loans and Merrill Lynch toxic assets. But if you hold it long enough your grandchildren will make a killing off this investment. Just like we are making in Fannie/Freddie...

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Citigroup (C) -35%
Bank of America (BAC) -33%

"Safe" Wells Fargo -27%

Since "He Who Walks on Water" Timmy G presented his plan a week ago Tuesday the market is down 13% in just under two weeks.

Humans never really evolve do they? They still worship false idols. Obama will save us - buy stocks. Geithner will save us - buy stocks. Bernanke will save us - buy stocks. Please, someone - anyone, save us!

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I am going to be shorting Ultrashort Financial (SKF) sometime either late today or Monday ... probably at end of the day to hedge against nationalization euphoria rally. Any move to push all the losses onto the taxpayers and away from the market will be "cheered" - pathetically

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[Feb 5, 2009: Bank of America Below $4]

Mark wondered two months ago in [Nov 26: After Citigroup is Bank of America Next?] Magic 8 Ball says Yes!

We posed the exact same theory after the Citigroup (C) bailout was announced. Good to see realism and cynicism reach into our news agencies ;) That Countrywide Financial exposure cannot be a good thing. I am also wondering if the Merrill Lynch (MER) deal is still going to go through - certainly the terms are prone to change.

A few days later [Dec 1: Hello, I need your Tax Dollars]

Full disclosure - I'd be short Bank of America (BAC) here, with stop loss over that 20 day moving average (aka north of $16.50s or so) - I'd use a 4% stake or so.

I'd be short until the US government uses my own money
[
Nov 24: Details on Citigroup Bailout] to blast myself out of my position, using my own taxes to cause egregious losses to myself when they bailout BAC. That's how socialism works. (Or, I'd stick around with a target of $7-$10 if that comes before the government uses my own money against me.)

Hi, my name is Bank of America - aka Citigroup 2.0 [
Nov 26: After Citigroup is Bank of America Next?] Now who wants some of these yummy Countrywide loans? Anyone? Will someone else other than Uncle Hank raise their hand? Please... anyone but Hank... please.

Looks like my target of $7 to $10 was more than surpassed... can't claim I'm a bear! A bear would of said $1.

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