penny stocks new york
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What is the future for Washington Mutual bank?
I have a CD account at Washington Mutual bank, and I hear the rumors that WaMu is going bankrupt and taking all the money they have with them. Since I have 8 more months until I can access my CD acct. money without a penalty, what do I do?
Your CD is fine as long as you have… what?
UNDER $100k in it.
Banks are not permitted to go BK. They can be seized by the gov (FDIC) if the FDIC feel they are insolvent – which WAMU is, in my opinion.
WM has been on my “BK Watch List” since Nov 2007, and have been short the stock and long the puts many times since.
I know I just said they can’t go BK (per my watch list), but I don’t have a “Seizure” list.
If WM’s stock keeps on it’s current 20%+ a day loss, I give them no more than 7-10 days before the gov takes them over. It will mostly likely happen on a Friday night right before or after the bank closes, and Wall Street is home and can’t trade on the news.
If this does happen the stock will trade for pennies, and possibly be worthless over time.
Shall we watch and see?
The following is part of an article from Reuters:
(I don’t have a link since it was from my Institutional Wire Service.)
“WaMu came under further pressure on Wednesday (09-24-2008) when Standard & Poor’s slashed its credit rating deep into “junk” territory.
The thrift replaced its chief executive this month after suffering losses totaling $6.3 billion over the previous three quarters.
It has projected $19 billion in mortgage-related losses through 2011, but analysts have said credit losses could reach $30 billion.
Complicating the sale process is what to do with the thrift’s $227 billion book of real estate loans, more than half of which consists of home equity loans, option adjustable-rate mortgages, and subprime mortgages.
It was not immediately clear how much of WaMu’s troubled loans might be eligible for Washington’s $700 billion financial industry bailout program.
WaMu has a significant presence in California and Florida, two of the states hardest hit by the nation’s housing crisis. But its 2,239-branch network could appeal to many lenders looking to expand in retail banking, especially in the western United States and the New York City area.
WaMu ended August with $143 billion in retail deposits — roughly triple the size of the entire Federal Deposit Insurance Corp fund that backs customer deposits. It has also said it expects to end the quarter with a “well-capitalized” status well in excess of federal minimums.”
See. WM is gone now. Guess it wasn’t going to take 7-10 days to be taken over by the Feds as I said on 09-25-08, and had been stating such risk since Nov 2007 (see post history).
JPM acquired the assets of WM. WM’s stock has been halted. The bank will have a new name “JP Morgan Chase (JPM).” Deposits and loans are under JPM’s custody now.
However, as for the corporation itself, now that they are no longer a functioning entity, the are 99.99999% chance will file for bankruptcy.
I am still concerned with WB, NCC, and regional banks in general. I hope WB doesn’t fall under, but they have been on my “Concerned List.”
I don’t want to put WB on my “BK Watch List” because since 2001, all but one of the companies that I put on this list went BK within a year. The one exemption was Rite Aide who is still on the list, and whose stock is trading recently under $1.00
Why a Penny Stock Often Won’t Sell