Until Banks Work, Go With the Brokers
By Jim Cramer
RealMoney.com Columnist
2/7/2006 7:40 AM EST
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This column was originally published on RealMoney on Feb. 6 at 11:00 a.m. EST. It's being republished as a bonus for TheStreet.com readers.
The decline in the bank stocks is disturbing for certain. If we didn't have so many other sectors that are working, including the brokerage sector, I truly would be concerned.
The banks are going down, of course, because it makes all sorts of sense for them to go down. They are housing plays. They don't have a lot of flexibility. They shouldn't even be lending in this environment.
And, let's make it even tougher for them. Compare them to Goldman Sachs (GS:NYSE - commentary - research - Cramer's Take), which, according to Bloomberg, just passed Morgan Stanley (MWD:NYSE - commentary - research - Cramer's Take) for the terrific title of fastest asset-gatherer. That's a truly nice, fee-based, non-Fed-linked, business, with tremendous, non-hedge-fund-like annuities. Plus, the 30-year soon will be open for business, and anyone who traded at Goldman in the last two decades knows that these auctions are a license to print money.
So, yes, Wells (WFC:NYSE - commentary - research - Cramer's Take) goes down everyday. Yes, it is a challenging environment for Commerce Bancorp (CBH:NYSE - commentary - research - Cramer's Take) -- as Vernon Hill admitted just Friday in a one-on-one interview on my radio show, done at one of his own new locations, even.
The bottom line, though, is one day the Fed will finish, although that day obviously has just been pushed further out, and these coiled springs will explode. In the interim, Goldman, Lehman (LEH:NYSE - commentary - research - Cramer's Take), Bear (BSC:NYSE - commentary - research - Cramer's Take) and Merrill (MER:NYSE - commentary - research - Cramer's Take) make more sense. |
