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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Jurgis Bekepuris who wrote (30349)	3/16/2008 11:36:19 PM
From: Spekulatius	Read Replies (1) \| Respond to of 78666

I am clear of US financials except some dinky overcapitalized thrift conversions trading below tangible book. i think I plan on keeping it that way for now. JPM does not seem to have the subprime flu but I am concerned about their derivative book that exceeds tangible book. I have no clue what they are for and if they are posing any risk and i have no desire to find out. in these times, the simpler the business, the better. WFC is probably the first bank i'd buy but they are big in the mortgage business as well. In my opinion the next stage after the subprime is done are prime mortgages from bubble vintages 2004-2007. All mortgages originated in that period that a are substantially under water are subprime in my opinion, regardless of the credit rating of the mortgage holder. Lot's of folks will walk away, even if they could pay up. so this will be concerning all mortgages of 2005-2007 vintages with < 20% down. many home equity loans are going to be questionable as well,a dn WFC has quite a bit of those,e ven so they did already a partial writeoff. AXP i like better but i first want to see dealing them with loan loss reserves. In my playbook they have another 1B$+ reserve boost ahead of them plus pay for increasing ongoing cardmember defaults. their reserves levels even after the Q4 boost are very low in the historical context, too low for a recession, IMO. I am going to buy financials tomorrow. I am interested in purchasing some more pipeline MLP's, and if i get 5% off from current prices , i might bite. I have about 10% liquidity in the IRA and 25% in my taxable account.