Should anyone in their right mind own any financials? Is now the time to scoop up "bargains?"
Bear Stearns(BSC Quote) closed at $56 on Thursday, then closed at $30 on Friday. You may have seen Jim Cramer mention that there would be some sort of take under, but I don't think anyone was expecting $2 per share for the equity.
The rest of the financial sector is down in some measure as well, in what has been a continuing theme. The Financial Select Sector SPDR(XLF Quote) is off, as are stocks such as Morgan Stanley(MS Quote), Citigroup(C Quote), Merrill Lynch(MER Quote), Goldman Sachs(GS Quote), Lehman Brothers(LEH Quote) and E*Trade(ETFC Quote).
I have been making comments since late 2005 about this entire business. When the yield curve inverts or takes on an abnormal shape, it creates a bad fundamental environment for financial stocks. Accessing capital becomes more difficult and normal lending becomes less profitable. ...
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