Two Ways: Citi Lies in Ruins
Strengthen your portfolio in good times and bad.
Another scary day for bulls as banking jitters sparked another selloff. Shares of Citigroup (C) and Bank of America (BAC) plunged to their lowest levels in decades over fears the US government would nationalize banks over the weekend.
A Citigroup spokesperson defended the company by highlighting its Tier 1 capital ratio, a measure of financial strength, and stressed its ongoing commitment to trimming its balance sheet and cutting expenses for "profitable growth" in the future.
Despite this valiant effort, Citigroup shares closed down 22% to $1.95.
A mouthpiece for Bank of America also did his part, saying the company is well capitalized, profitable and continues to actively lend.
Bank of America shares recovered from an intraday loss of 30% to close down 3.56% to $3.79.
For more, see Minyan Peter's The Nationalization Scenario.
From the Bull Pen: If we're getting close to some type of major rally, bulls can look to the Ultralong S&P 500 (SSO). One option is to start an initial position here while keeping open the possibility that we could plunge lower.
From the Bear Cave: As Professor Kevin Depew so eloquently stated, being short right now feels like picking up pennies in front of a bulldozer. The situation's gloomy, but it seems the short opportunities in equities are over for the time being.
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