Tuesday, April 21, 2009

Wall Street worries about the banks again? And?

I am sorry, but no pity party for banks here.

We can not save the innovation that put America on the map, the auto industry, but we can give more money to banks that put themselves in this predicament because of sheer greed? The same organizations that don't understand that bonuses in the millions to folks that put the economy where it is just is unacceptable, while American families are struggling partly because of their bad decision making?

Puh-leaze. No pity here.

Obama Administration trend very carefully here. If you want the auto industry to go bankrupt, you for damn sure better make sure some of these banks go down the drain, as well. If you don't, many middle class Americans won't get that picture, AT ALL.

Anxiety is growing again over the health of the nation's largest banks, and with Congress hesitant to commit more money, the Obama administration is exploring ways to strengthen them in the face of an unrelenting recession.

Results of the federal government's "stress tests" on big banks are due May 4, and Wall Street is increasingly worried they will show some banks are in worse shape than expected.

The renewed bank fears drove the stock market down on Monday in its worst showing in six weeks. Bank of America stock lost nearly a quarter of its value, and the Dow Jones industrial average fell almost 290 points.

Bank of America reported a first-quarter profit of $2.8 billion, joining other banks whose earnings reports have looked positive at first blush. But some analysts say accounting steps are concealing the depth of the financial industry's woes.

The banks have been helped by income from trading and cheap borrowing, but they are still struggling with bad debt, said Joe Saluzzi, co-head of equity trading at Themis Trading LLC.

Investors are "looking at bank numbers and are saying they are not that great," he said.


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