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Safe-Deposit Stocks

Wednesday, 19 Mar 2008 | 6:30 PM ET

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?

Banks

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.

Brokers

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.)

Tomorrow's Trades: Safe-Deposit Stocks
Money-center banks are outperforming, as brokers and the broader market struggle. The Fast Money traders, along with Jeffery Harte, managing director in equity research at Sandler O'Neill, discuss opportunities in this sector.

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

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JPM MLP ETN
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