Fear Mongering in BofA (BAC) at Epic Levels
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The fear mongering in Bank of America Corporation (NYSE: BAC) appears to be reaching a crescendo... and buyers are stepping in to stabilizing the shares.
After trading as low as $6.01 earlier, BofA has rallied back to $6.33.
BusinessInsider's Henry Blogdet said the company may need raise $100-$200 billion in fresh capital. This goes against every other analyst on the Street - with the consensus being the company doesn't need to raise a penny and can use proceeds from the sale of non-core assets to fill any balance sheet void.
Blodget not only put out this wild rumor of a $200 billion capital shortfall, but this morning went so far as to suggest the Treasury should come up with an action plan to seize the bank if its stock keeps falling.
Blodget is not just another blogger, he is a former analyst at Merrill Lynch - now owned by BofA. If you don’t remember, Blodget was the poster child for Wall Street abuses during the dotcom boom and had an epic fall from grace.
While we respect what Blodget has done with BusinessInsider, he is guilty of rumor mongering with his latest BofA rants.
Stock speculators appear to be focusing in on the massive amount of fear in the market on BofA. While no one appears to have a great grasp of BofA's exposure should the economy continue to dive, some big long bets are clearly being placed at current levels at just 0.32x book.
After trading as low as $6.01 earlier, BofA has rallied back to $6.33.
BusinessInsider's Henry Blogdet said the company may need raise $100-$200 billion in fresh capital. This goes against every other analyst on the Street - with the consensus being the company doesn't need to raise a penny and can use proceeds from the sale of non-core assets to fill any balance sheet void.
Blodget not only put out this wild rumor of a $200 billion capital shortfall, but this morning went so far as to suggest the Treasury should come up with an action plan to seize the bank if its stock keeps falling.
Blodget is not just another blogger, he is a former analyst at Merrill Lynch - now owned by BofA. If you don’t remember, Blodget was the poster child for Wall Street abuses during the dotcom boom and had an epic fall from grace.
While we respect what Blodget has done with BusinessInsider, he is guilty of rumor mongering with his latest BofA rants.
Stock speculators appear to be focusing in on the massive amount of fear in the market on BofA. While no one appears to have a great grasp of BofA's exposure should the economy continue to dive, some big long bets are clearly being placed at current levels at just 0.32x book.
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