Be extremely careful of Wall Street analysts telling you how good or bad a bank or insurance company is for you to buy, or bad to sell.
The current deep financial slowdown, like all recessions, is started when business people and consumers get pessimistic and stop spending or buying.
Rumors are often bandied about banks, fomented by bank analysts who cannot possibly see a bank’s asset portfolio. That makes for self-fulfilling events. Especially when bank holdings must then be marked-to-market.
Fear frenzy takes hold as analysts persist in this self-fulfilling bearish sentiment. This occurred to help set off and exaggerate our current deep recession.
Bank analysts are certainly never privy to complicated derivative portfolio information, or “repo” positions, if they know so little of the plain-vanilla type. And if they were, they could not understand the inherent complexities.
Yet every negative word they can utter can doom the soundest financial institution, to the point where that organization truly sinks towards insolvency.
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