Monte Dei Paschi Needs More Money

The stories about Monte Dei Paschi didn’t halt over the Christmas break. This is part of the political calculations because the Italians aren’t paying as close to the news as they normally would which means there will be a delayed response. It’s not that Italians are in love with their current government or banking system,…

Monte Dei Paschi Is The Key To Europe

If you thought the Monte Dei Paschi story was over, you underestimated the situation. It is only getting started. The results of how this plays out will have wide ranging ramifications for other troubled banks in the future. In the European stress test, the bank came in last place out of 51, so it will…

Bitcoin About To Make Record Highs

The price of Bitcoin has rallied to above $900 as it closes in on the record highs it made in 2013. For those who compared Bitcoin to the tulip bubble, this is tough to understand because it should be at zero by now if it was a fad. Fads don’t recover their losses and they…

Poor Data: Weak Economy?

The Dow has fallen two days in a row for the first time since the election as negative data was able to temporarily stop the Dow from reaching the much heralded 20,000 level. It’s quite amusing to see the media and traders get disappointed from such a meaningless number not being reached. I think the…

Monte Dei Paschi The Zombie

The day the zombie bank Monte Dei Paschi is rescued is finally upon us. The bank tried to raise 5 billion Euros through the private market, but failed. The bondholders’ debt for equity swap only netted the bank 2.45 billion Euros. The Qatar sovereign wealth fund decided not to make a 1 billion Euro investment…

Should You Sell Stocks Now?

In this article, I will further specify the level of bullishness in the market which, I feel, doesn’t represent reality. It has made sense to be bearish this year, but logic doesn’t matter when your contrarian portfolio has had a bad year. It doesn’t give you any solace. I have been wrong all year long.…

Italian Bank Update

Italy is coming closer to the inevitable government bailout of the world’s oldest bank Monte Dei Paschi. The situation was always bound to happen at some point, but the actual nationalization process could start in the next few days. I mocked the possible loophole on how the Italian government will be able to bailout Pasche…

Predictions For 2017

Predictions are tough to make. They are especially difficult with central banks manipulating asset prices. Excess liquidity does wonders to stocks no matter what the individual company’s fundamentals looks like. That being said, I still want to make some predictions in this article for 2017. They may not be more accurate than the typical punditry,…

Buybacks Down, Optimism Up

The equities market has rallied on the anticipation of the Dow hitting 20,000. It’s an irrelevant factor for fundamental investors, but it matters to traders who look to push the market higher. The market has looked to push higher since the election as momentum reigns supreme. It’s a weird concept to say that the market…

Italy Kicks The Can

This week Monte Dei Paschi, the weakest Italian bank, is under renewed scrutiny because it still needs to raise money to recapitalize and get rid of 28 billion Euros in bad loans it has. The reason why I focus on this issue is because of the two risks in play. The first is the potential…