Money-center banks appear to be outperforming the brokers. Is there a trade here?
Jeffery Harte, Managing Director at Sandler O'Neill joins the panel for this conversation. Following is a summary of his main points.
Are big money center banks the greatest beneficiaries of cheap money and will that drive their performance over time?
I think expanding the interest margin is a good thing for them however the rising credit costs will off-set that benefit, explains Harte. If you want to dip your toe in the water I would advise caution because there are sharks in that water.
I think investment banks offer more attractive opportunities, says Harte, because they probably have a lot of pain behind them, simply due to the accounting techniques they use.
Quality of management is something to consider too, adds Harte. Check out U.S.Bancorp and JP Morgan . (Harte has a buy on JP Morgan.)
I like Goldman Sachs , says Pete Najarian. I think they’re best of breed. Also look at Morgan Stanley .
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Trader disclosure: On Mar.19, 2008, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Najarian Owns (AAPL), (BIIB), (CSCO), (MCD), (MS), (MSFT), (NOK), (XLF), (YHOO), (C), (IDCC); Najarian Owns (BSC) Calls, (TSO) Calls, (CCU) Calls; Najarian Owns (LEH) Puts; Macke Owns (YHOO), (INTC), (DIS), (EMC); Seymour Owns (AAPL), (CSCO), (INTC), (MER), (MSFT), (S), (SBUX), (TSO); Seygem Asset Management Owns (CHL), (EEM); Seygem Asset Management Owns Gazprom; Sandler O'Neill Has Received Investment Banking And Non-Investment Banking Compensation From (BAC), (C), (JPM), (MER), (MS), (WB), (WFC), (GS), (LEH); Bear Stearns Companies Is A Client Of Sandler O'Neill