Norm Lasky's expertise in finance and banking is unsurpassed - and he has the credentials to prove it. Norm has been posting on various message boards for at lest the past sixteen years. I have followed his posts on numerous boards and I can attest to the fact that his interest is mainly helping others that have less knowledge and experience. It is pitiful that many individuals that post on these message boards fail to understand his intentions. How he continues to have the patience to inform and teach others - many of whom are impolite and obnoxious - is beyond my understanding. It does attest, however, to Norm's unusually high standard of personal conduct. He is a rare individual indeed.
For those of you that are mean and obnoxious in your posting, I have only one wish - that you short the devil out of BB&T stock.
Norm has a bad habit of dismissing anyone or any source that disagrees with him (his view) as wrong and the disses the messenger.
I am the first to admit I am not always right and use as many sources as I can find (if I find them to have a decent record). Are these sources always right? of course they aren't - it does not mean the sources are useless. In the end it is up to you to evaluate and decide based on the information before you.
What I do know is Norm has been positive without fail on BBT for a long period while I have been positive at times and negative at times and that I have made some very good returns trading BBT from both the long and short side over the past 3 years. You can get lost in the numbers of an individual stock and miss the big pictire IMO.
In short I find Norm's inflexible view of little use in trading this stock. Now he claims things are just fine - well, I am here to tell you economic #s (employment?) have been so-so at best. The world Marcro view seems very iffy (China, Europe). QE (Twist, LTRO) seems set to be quiet for a while so there will not be the liquidity we have seen since last fall to push equities higher... Just a thought for you consideration - BBT does not exist in a vacuum.
I agree with your contention that you can make considerable profits trading BB&T; however, the trend of the economy is up despite Republican Party efforts to restrain it. If the Democrats retain the Presidency, the economy will continue to improve, and most stocks will continue to move up slowly - especially BB&T, which is the best positioned regional bank. If the Republican Party wins the Presidential election and both houses of Congress - they will highly favor regulations that are very supportive to bank profits. So whether it be heads or tails - BB&T is going to be a big winner in the long run.
Incidently, Norm has traded BB&T stock very profitably even though he retains a significant core holding.
I don't have any problem with individuals that are bears or bulls. My problem is only with individuals that act inappropriately.
Actually I am not sure that the comparison will prove if Norm has been of benefit or not. I have taken him to task several times for making the same mistake in his estimates. He repeatedly overestimated the bank's ability/willingness to "write in" income based on overstated reserves for loan losses.
However, I found the rest of his estimates and opinions quite valuable. He chose to play calls at a 20 strike but I took his info and confidently sold puts at 23 and 24.
Money in the bank.
I agree with the notion that one could go back and read prior postings to determine whether a poster knows what is going on. Norm's estimates have been high but his insight into an enterprise that was clearly a good investment 18 months ago was valuable.
Me thinks you dont understand finance (or just dont like smarty's facts). Yields on treasury or GSE investments will go up (and a lot too), but the value gets marked down on the security itself. ..the net payments to BB&T dont change for what they hold, but the price collapses. The runoff as you it call will be impaired, as they will get far less on the liquidation/maturity of the insturment than what they are carrying it for now. When you add in transaction costs it is a net loss no matter how hard you try and explain it away. And for any increase in yield they may get on such securites in the future (after they realize the loss on sale), they will have a matching requirement to simultaneously pay depositors more for demand deposits, CDs, etc. When the portfolio gets clipped it is a hit to equity, which impairs the TNW you are so proud of. This is all bad for a bank. And you assume that BB&T is never going to take the proceeds of its cash and securities portoflio and lend it out....nice. How is that going to help grow its loan portfolio? Oh, I forgot, they only make loans to "creditworthy" borrowers and there must be a limitless supply of those.
You may also not understand how stress tests work with the Fed and CoC. The comment about home mortgage LTVs is well, bizzare, to you use your phrase. As if an implosion in the treasury, bond, and currency markets will not impact mortgage backed securities, because they have 80% LTV ?!?!? (and according to whom is that number attributable? Your friends at BB&T?) And who cares anyway? Were you on Mars in 2008-2009 when asset backed securites were valueless, even the ones that were ensured by the govt.
And buddy, you need to stop referencing what "BB&T says" to defend your arguments. Do your own work. Will NIM increase? maybe. Will loan growth plummet? maybe. Credit spreads will not necessarily widen (which is needed to grow NIM) just because benchmark yields go up. In fact in a rising interest rate environment economic growth will be so shallow banks will have to tighten spreads and relax credit quality to attract loan growth. NIM does not improve on match funded duration if spreads tighten...now if BB&T wants to fund itself in the overnight repo market, that's another thing entirely.....
And if BB&T decides not to tighten spreads to attract loans, their NIM may in fact be great...on the one or two loans they make in a year. It will be great for the loan officers, they can play golf all week becuase they sure wont be making any loans.
Please cover all the points, not just ape what BB&T wants you to ape, or some cut and paste job on arcane and meaningless stats on the internet designed to dazzle the uninformed on yahoo.
Norm must be or was a school teacher. Once a teacher, always a teacher. Probably was a bookkeeping or accounting teacher.
The country could use a lot more good teachers, not just a body to be in the front of a class waiting for a pay check. I have known too many of these that just hated teaching.
Have a great vacation. I don't blame you for leaving the jealous morons on this board who can't handle people listening to you and not them.
They don't understand that the value of the board is to share differeing views and opinions - and letting readers weigh all of it to reach their own conclusions.
I'm sure you are appreciated by many more than not. Thankds again for your contribution.
So when interest rates go up and all their holdings in their securities portfolio lose value, and they have to start paying their depositors interest (instead of just taking fees), and they feel compelled to raise spreads on loans that borrowers cannot even qualify for today and hence will have reduced loan growth...tell me again why that's a good long term play?
Fact is this nation is never again going to dole out money to banks. When the bond and treasury markets' bubble collapses, which it will, a lot of banks will fail, some banks will not, but their share prices are going to be eviscerated. Did you know that the Fed's stress test did not include a stress on the bond or treasury markets as part of a bank's health? The Fed knows what the Achille's heel is, but will not admit it. I dont know when this will happen. A year? 2? 3? But it is going to happen, and in the meantime you might get a divi increase in BB&T and a move in the share price, but once the market structurally corrects itself....any gains will be wiped out and this stock will be back in the teens. remember, there is a difference between trading and investing.
ECRI told cnn money on 9/30/11 that recession was imminent. Achuthan, their chief economist, said the US had entered into recession in the 3rd qtr. 2011 or would be going into recession in the 4th qtr. 2011.
Here we are 7 months after the fact. Added 1 million plus jobs. Consumption expenditures in the 1st qtr. 2012 were up almost 3% from 4th qtr. Car sales are booming. Freight excluding coal and grain is up 6% ytd. Intermodal is up 3% ytd. S&P 500 profits are close to record highs. Banks are doing ok. Yep, Achuthan really nailed it.
ECRI economic model is proprietary so it is not possible to analyze their forecasts. We're all entitled to our opinions but I think only a fool would be praising ecri predictive abilities.
From what I've read, they're the laughing stock of the economic community.
That's not to say I'm a bull right now. I'm 44% cash and have sold covered calls on about 1/3 of my portfolio. Think it's likely that markets will be volatile driven largely by weak economies in europe and the threat of default.
Bbt is a core holding. I think in 2013 they'll make $4 plus per share.