munky.org|v3.0

Quick screen shot of BAC this evening.. Feel the momentum?

Wow, you know, there are some days that the street can put you in a GREAT mood. Right now my aggressive buying of certain financials during it’s move into the pit are showing great promise. In fact, my financials alone are strong enough to overcome my modest losses and other sectors. My IRA is in the green for the first time since I started it (after my 401k lost 30%+ on the poor management of the funds).

So is this just another short term rally or a sustainable move? Well, we’ve been creeping up now for about a week. The fed’s aggressive purchasing of more securitized debt has definitely helped. The news that Citi and BoA, which some had considered good as dead, may actually post a profit for Q1 helps. Plus BoA’s news that it intends on paying off it’s TARP obligations by the end of 2009 or beginning of 2010 doesn’t hurt either. Seems opposite for a company in supposed dire straights. If it all pans out, amazing how I’ve been saying it all along. If you don’t believe me, just read through the posts. I’ve been buying up BoA like it’s candy when it was sub-$4. My only regret? I didn’t have enough money to buy as much as I wanted (like a few thousand shares). Average price for my BoA? $6.04, buying since it was $25 on south. it closed at $7.67 and is at $7.85 in after-hours trading.

So to those guys trying to get Lewis ousted: stick to what you know. You don’t run banks, you run funds, and there is a large gap. This man is large and in charge (ironic he’s short), and he’s the bank’s best bet to recovering and being a full force.

I also heard some disturbing news last night regarding the banks. Some in Congress are wanting to blame lack of proper anti-trust regulation as the cause of the recession. Hogwash. They also want to consider forcing some of the larger banks to break up. Honestly, this is horrible stuff. Their supporting evidence is flimsy at best. They have seen only what they want to see, and ignore the rest of the wide world.

And finally, an analyst on CNN I can agree with. I don’t remember who it was – I saw it eating a quick bite before evening Physics Lab – but someone they were speaking to on The Situation Room was fearful of the plan of the special tax on AIG bonuses. He agreed that they are trying to make up for the fact they dropped the ball the first time around by abusing their legislative abilities. When a government decides it wants to arbitrarily tax those it wishes because they don’t like what they are getting, that is when we need to be fearful people.

For a quick laugh though, an iReporter jokingly went with the whole pitchforks ready to to mob against AIG because of the bonuses. I’ll see if I can grab the video somewhere.

NSDAP election poster in Vienna in 1930. Translation: "We demand freedom and bread".

Namely the 1930′s. The landscape, a defaulted Germany. After being defeated and economically devasted from this first World War, Germany is in dire straights. The thoughts come to mind of the woman taking a wheelbarrow full of money to the baker for a loaf of bread. As she goes outside to get her wheelbarrow, she finds the wheelbarrow gone, but all of the money still there. When a wheelbarrow full of money is worth less than the wheelbarrow, things are in bad shape. Then in 1934, with the death of Paul von Hindenburg, Hitler abolished the presidential office to become Führer. We should all know what happens next.

Although America may not be in the exact same position to have it’s democracy overthrown in favor of a dictatorship, we are suffering many of the symptoms. We are all in fear right now, and this is the real weapon of a tyrant. Who is this tyrant? I have no clue, even if he or she did exist. So before you start, leave the Obama hating out of this. You’ll miss the point.

Right now we are puppets. Just watch. One word from a politician will make sweeping changes within the people. Case in point. Christopher Dodd makes a remark about the need for nationalization. What happens? The banking sector crashes. They have us by the balls and they know it.

I am urging anyone with one iota of sense to begin thinking for yourself. I watch the news get more cloudy and murky daily. They completely miss the point more often than not. They make representations of the truth, most often comparing apples to oranges. Either too many of these reporters are clueless, or well too clued in. I applaud Meredith Whitney, formally of Oppenheimer Securities. She was the obscure analyst that rang alarm bells on October 31st, 2007 about Citigroup. The market listened. Even more importantly, Citigroup listened.

The difference between reacting from truth and reacting from a rumor is the company’s reaction. If the nationalization threat was immediately on Citi and BofA, changes would have occurred already. Instead, only the markets reacted out of fear. Imagine waking up sick this morning to find that Bank of America had dropped from $3.93 to $2.66 in just a couple of hours. Out of a rumor. The stock is back at $3.68 right now. Still below its real value but about 30% better than it’s intraday low. That should tell you something.

So people, please please please stop running around like mindless sheep. We say we don’t believe everything we hear on TV, yet the stock market proves otherwise. Maybe I need to go on and say Jesus told me he was coming back tomorrow, and that if you wanted to get into heaven you needed to give me all of your money and assets! I’d make Warren Buffett look like he needed food stamps.

(image from Wikipedia)