What the Pros Say: Investing Tips after Lehman Fall
The financial sector took another hit after Lehman Brothers filed for bankruptcy protection on Sunday and Wall Street scrambled to shore up the system.
Investment experts from around the world weighed in with thier outlook for the stock, currency and commodities markets and the financial sector and tips for what investors can do during the turmoil and what Wall Street may well look like down the road.
The Impact on Wall Street & the Financials
Even Oppenheimer's Meredith Whitney is taken aback by the magnitude of recent events. "What this does is to exacerbate the credit crunch because it pulls so much liquidity out of an already strapped market.”
Capital Preservation is Key
"Preserve capital and don't take any long-term positions you can't get out of quickly," Rick Sthottenfeld of Schottenfeld Group LLC advises investors. "Preserving capital is really important to take advantage of the opportunities that are going to come on the other side of this," he adds. (See accompanying video.)
AIG Must NotBe Allowed to Fail
Jim Cramer warns viewers, in no uncertain terms, that it would be a tragedy if AIG is allowed to failand points out insurers that have solid balance sheets.
Why the Fed Will Hold
Talk of a Fed rate cut is too premature at this stage, said Peter Redward, head of research for emerging markets, Asia at Barclays Capital, after talks to sell Lehman Brothers failed.
Less Is More On a Tough Day
"I tried some Goldman Sachs for about a half an hour. It costs me five bucks and I’ve never been more happy to sell something, particularly now that I know they’re going to be asked to help bail out AIG,” says Fast Money's Jeff Macke. “It’s a tough tape, man, and less is more.” (See accompanying video.)
Best Banks to Buy
"The winners are the stronger financial institutions, that are consolidating, that are going to be gaining market share. The winners are those who saw this thing coming," Mohamed El-Erian, Pimco co-CEO, told CNBC. El-Erian said that Bank of America could be one of the winners.
Singapore banks are perhaps the best financial plays in the Asian region, believes Trevor Kalcic, senior analyst of equity research at ABN Amro Securities (RBS).
More 'Bad' Banks?