Right now the large holders of banks (and credit card companies) are buying them so that later they can unload them this is how the big boys operate.. buy on bad news then sell later when you forgot about the bad news they will have precicely 90 days to do it. now fed is talking about no rate cut this is devastating for financials and the bleeding will continue as foreclsoures skyrocket and consumer spending collapses as consumer can no longer use home as atm indeed morons who bought homes for 700k in cal can;t refi as the homes are worth 520K now underwater. No more toys rv's travel second homes and payments 2300 to 3500 causing many in the east bay to walk out handing keys to Citi and Wamu ! For credit card companies the defaults will skyrtocket as overal transactions fall dramatically making these stock hugely overpriced ! For construction the glut of homes and tappe dout consumer means no construction commercial or residential ! Target warned! lowes warned !wet seal warned !
The cycle once started does not stop in 30 days folks ! you are going to learn the lessons of your lives in the next 6 months if long construciton/financials ! Reuters Washington Mutual expects big drop in profit Friday October 5, 11:03 am ET By Anupreeta Das
NEW YORK (Reuters) - Washington Mutual Inc (NYSE:WM - News), one of the largest U.S. mortgage lenders, said on Friday it expects a 75 percent drop in quarterly income on losses and write-downs on mortgage loans and securities.
Loan loss provisions for the third quarter will be about $975 million, the largest U.S. savings and loan said in a statement. It expects total losses and write-downs of about $410 million.
Only days ago, Citigroup Inc (NYSE:C - News), the largest U.S. bank by market value, said it was expecting a 60 percent fall in third-quarter earnings on $5.9 billion in losses and write-downs from subprime and leveraged loans, fixed income trading, and weakness in its consumer business.
Merrill Lynch (NYSE:MER - News), the largest U.S. brokerage, said on Friday it would post a third-quarter loss after writing down $4.5 billion in collateralized debt obligations and subprime mortgage holdings.
"We're disappointed with our anticipated third-quarter results," WaMu Chief Executive Kerry Killinger said in a statement. But he added the company expects an improved fourth quarter on good performance in its retail banking, card services and commercial group businesses.
Killinger said the bank, which announced 1,000 layoffs last month, has the liquidity and capital necessary to develop its businesses and support its current dividend.
Washington Mutual earned $812 million before exceptional items in the previous year's quarter. A 75 percent drop in the latest quarter's profit would see that figure plunge to $203 million, or less than half the $425 million forecast by analysts surveyed by Reuters Estimates.
Analysts said they were not surprised by WaMu's news.
Punk Ziegel & Co analyst Richard Bove said he assumed the thrift would take a $700 million loan provision each in the third and fourth quarters, a little lower than WaMu's $975 million.
Thanks so much for the information and the excellent education and reminding for most of the longs on this board. I sincerely believes some of the longs on this board are paid by the banks and the analysts to pump cat so they can get to sell high meanwhile to lure many more ignorant bag holders while they sell. I only hope any smart investors in CAT be aware of the risk of CAT's business down the road and to the next year. The housing sector slow down and the piling up credit debt in U.S. right now is only the beginning. Consider the warning right now as a early Christmas present for we are going to see more job losses, slower housing business, higher credit debt and higher fuel price as we get into Q4 and into 2008, 2009 and 2010. Cash is King. Protect your cash liquidity and your asset as the prime goal in the next few years. I expect more layoff from U.S. corporates for more downsizing as we move closer to November and December. Don't risk your money in the financial sector and in the stock market. You ain't see anything yet.