This column was originally published on RealMoney on Sept. 15 at 11:39 a.m. EDT. It's being republished as a bonus for TheStreet.com readers.
Here's a frightening thought:
are actually very well-run banks, and now both have said they see the yield curve eroding profits. It's arguable that these companies are simply able to see and assess the damage of this yield curve far earlier than other banks.
Before Regulation FD, I believe that bank CFOs would have been calling all the big Wall Street analysts right here and telling them, "Look, you've got to shade your numbers down."
Now, with the brilliance of Reg FD in place, what happens is that only the friends and family of bankers get to sell. We all have to wait until it is legal and they tell everyone at once. Oh, not the intent of the law? Hmm, I guess Arthur Levitt should have thought of that. Too late now.
Fifth Third and Commerce Bancorp simply represent the vanguard. I continue to believe that even after the vast multiple compression in banks and the declines we have seen in many of their stocks, there's still room to run to the downside. You don't get bad news from two of the best and yet have the worst do well.
Elsewhere on this site and on our sister sites, people continue to pound the homebuilders. I agree with that sentiment. They have neither the dividends nor the controlled costs that banks have. Banks aren't big buyers of gypsum board, which seems to go up 15% in price every other day.
Yet, I still believe that banks are extremely vulnerable, and they represent a gigantic part of the
. Still not too late to sell them and pick up some oils.
P.S. from TheStreet.com Editor-in-Chief, Dave Morrow:
It's always been my opinion that it pays to have more -- not fewer -- expert market views and analyses when you're making investing or trading decisions. That's why I recommend you take advantage of our
premium Web site, where you'll get in-depth commentary
money-making strategies from over 50 Wall Street pros, including Jim Cramer. Take my advice --
At the time of publication, Cramer was long Commerce Bancorp.
James J. Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. Outside contributing columnists for TheStreet.com and RealMoney.com, including Cramer, may, from time to time, write about stocks in which they have a position. In such cases, appropriate disclosure is made. To see his personal portfolio and find out what trades Cramer will make before he makes them, sign up for
ActionAlertsPLUS. While he cannot provide personalized investment advice or recommendations, he invites you to send comments on his column by
clicking here. Listen to Cramer's RealMoney Radio show on your computer; just click
here. Watch Cramer on "Mad Money" at 6 p.m. ET weeknights on CNBC. Click
here to order Cramer's latest book, "Real Money: Sane Investing in an Insane World," click
here to get his second book, "You Got Screwed!" and click
here to order Cramer's autobiography, "Confessions of a Street Addict." Cramer appreciates your feedback and invites you to send him an email by