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Bank Failures Coming!
Here is a statement from Dan Denning which appears in the FREE Agora 5 Min Forecast 9/9/08. SKF should be a winner in the coming days !
“There will be more bank failures, and they will happen soon,” adds Dan Denning. While predicting more FDIC takeovers is far from a bold proposition, we understand the note Dan sent over today. The Fannie and Freddie rescue might cause a big wave of busted banks to wash ashore.
According to the FDIC, "while many institutions hold common or preferred shares of these two government-sponsored enterprises, a limited number of smaller institutions have holdings that are significant compared to their capital."
“Translation:” says Dan, “The other losers this weekend are those financial institutions that owned preferred equity in the GSEs.” You might recall Fannie and Freddie’s weekly stock offerings over the past few months… the GSEs issued millions of preferred shares to raise emergency capital. Regional banks all over the U.S. gobbled up these special shares.
Well… you know how this goes. Fannie and Freddie are penny stocks this morning. Their preferred shares are worth diddly. And we suspect there’s more than one already flailing bank out there staring at a big fat loss.
“There will be more bank failures, and they will happen soon,” adds Dan Denning. While predicting more FDIC takeovers is far from a bold proposition, we understand the note Dan sent over today. The Fannie and Freddie rescue might cause a big wave of busted banks to wash ashore.
According to the FDIC, "while many institutions hold common or preferred shares of these two government-sponsored enterprises, a limited number of smaller institutions have holdings that are significant compared to their capital."
“Translation:” says Dan, “The other losers this weekend are those financial institutions that owned preferred equity in the GSEs.” You might recall Fannie and Freddie’s weekly stock offerings over the past few months… the GSEs issued millions of preferred shares to raise emergency capital. Regional banks all over the U.S. gobbled up these special shares.
Well… you know how this goes. Fannie and Freddie are penny stocks this morning. Their preferred shares are worth diddly. And we suspect there’s more than one already flailing bank out there staring at a big fat loss.
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