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

To: Jurgis Bekepuris who wrote (33251)	1/9/2009 9:16:45 AM
From: Oblomov	Respond to of 78618

It doesn't appear there is a reason for the discrepancy, other than fear. MER debt traded at a significant discount to BAC debt, even though the merger was nearly a certainty.

To: Jurgis Bekepuris who wrote (33251)	1/9/2009 12:01:27 PM
From: Spekulatius	Read Replies (1) \| Respond to of 78618

RBS is from,a fundamental point of view much weaker than BCS. That is why the preferred trades lower. Both got a capital injection by the government but there is a strong suspicion that even that was not enough in the case of RBS. Depending on what the British government will do as a next step, the dividend for the preferred may not be safe. Bad things can trickle down. First it's the common that get's hit (and it is already) and next are the preferred.