Posts filed under “Analysts”

FBR’s Paul Miller, Banking’s Latest Cheerleader

Today’s Dick Bove wannabe is the once respected Paul Miller of FBR Capital Markets & Co.

In a note to clients that revealed a stunning ignorance of fiduciary and legal obligations, Miller said FHA, FHFA, and GSEs were “acting in their own self-interest as opposed to that of the broader U.S. economy.” The details of the note was reported on by Bloomberg.

Banking analyst Chris Whalen critiqued the position, stating, “Miller has gone to the dark side. Things are looking so bad for BAC, that Miller is starting to actually sound like a sell side analyst.

Whalen said that despite receiving billions in bailouts, the large public banks may be required to undergo major restructuring eventually. If MBIA and/or GSEs win in court, it could force the issue.

Whalen added “Rather than doing this piecemeal through litigation, we should use the power of receivership to organize this process, treating all banks fairly.”

Here’s Bloomberg:

“U.S. government-backed firms and agencies should “stop punishing banks” and suspend demands for mortgage repurchases because they are impeding an economic recovery, according to Paul Miller of FBR Capital Markets & Co.

Repurchase losses may total $121 billion, wrote Miller, a former federal bank examiner, in an analyst’s note to clients dated today. He previously said the tally might range from $54 billion to $106 billion. Losses for Bank of America Corp. (BAC) could reach $66 billion in some scenarios, he wrote.

Fannie Mae, Freddie Mac, the Federal Housing Authority and the Federal Housing Finance Authority “are acting in their own self-interest as opposed to that of the broader U.S. economy,” Miller wrote. Their claims “drain capital from the banking system, and they cause banks to overly tighten credit standards, which pushes potential home buyers onto the sidelines.”

Its a race to the bottom between European and American banks, with analyst integrity the collateral damage of the pending financial rout . . .


U.S. Must ‘Stop Punishing Banks,’ Halt Putback Claims, FBR’s Miller Says
Hugh Son
Bloomberg, Sep 6, 2011

Category: Analysts, Bailouts, Really, really bad calls

Housing’s Big Chill

I always laugh whenever I hear anyone say eejit hack claim “No one saw it coming!” This video — featuring a thinner, less gray version of your humble blogger — discussing the coming housing storm in 2005 gives lie to that claim. The advice: Sell banks, Sell Home Builders, Sell Home Depot and Lowes. Video…Read More

Category: Analysts, Credit, Real Estate, Short Selling

The Idiot’s Guide to the S&P Credit Downgrade

From Visible: UPDATED! > Click To Enlarge Infographic: Source: The Idiot’s Guide to the S&P Credit Downgrade Visible, August 17, 2011

Category: Analysts, Digital Media

The 2012 Crystal Ball

Slap your best-guess multiple (trend growth?, slow growth?, no growth? contraction?) on 2012 EPS estimates and decide for yourself where fair value is for the S&P.  Of course, beware Farrell’s Rule #9.  Set an alert to revisit this post one year hence. >

Category: Analysts, Cycles, Data Analysis, Earnings, Economy, Markets

The Punditry Chronicles

Forecasting is a rough gig that often confounds even those who do it for a living and generally do it well. Situational awareness (see e.g., this and this), on the other hand, is all about knowing “what you need to know not to be surprised,” and having “the ability to maintain a constant, clear mental…Read More

Category: Analysts, Contrary Indicators, Really, really bad calls, Research

An excuse for slashing entitlements

Opinion: An excuse for slashing entitlements Matt Stoller August 9, 2011 06:37 AM EDT ~~~ With all the talk of Standard & Poor’s downgrade, no one mentioned that the ratings agency’s business model is, essentially, lying for money. Instead, many politicians insist that the S&P downgrade is the reason for the market turmoil —…Read More

Category: Analysts, Politics

Two Headed Monster

Hat tip Mike R

Category: Analysts, Credit, Humor

John Coffee: Blame Ratings Agencies

Law professor John Coffee explains why major credit rating agencies inflated their ratings and how they caused America’s financial collapse.

Category: Analysts, Bailouts, Video

McGraw-Hill, Moody’s Risks Rise After S&P

> Our chart of the day comes to us today via Bloomberg, looking at YTD performance of McGraw-Hill (parent co of S&P), Moody’s, and the S&P500 Index. David Wilson observes: “McGraw-Hill and Moody’s face two threats because S&P cut the U.S. government to AA+, Appert wrote yesterday in a report. The first is greater regulatory…Read More

Category: Analysts, Credit, Markets

Standard & Poor’s Credit Rating by Country

click for interactive graphic Source: Chartsbin

Category: Analysts, Credit, Digital Media