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State of Banks After State Of Union

How will comments made by President Obama in Wednesday’s State of the Union impact your portfolio on Thursday, particularly your bank stocks?

Fast Money Executive Producer John Melloy has been all over the President’s message and what it means for the financials.

In his blog, Melloy says, what's really got investors worried is that Obama's bank tax plan announced in haste last week is not just talk, but something that will actually pass into law – and as a result restrict growth in the sector.

Although new regulations would need to be passed by Congress, according to Newsweek, they may not encounter too much resistance. That's largely because the GOP can't argue it would hurt small banks. The new tax only would apply to financial institutions with assets over $50 billion.

The move could score points with Main Street but not with Wall Street.

Take Your Position: Obama's Bully Pulpit

What’s the trade?

“If the President continues his tirade against the banking industry, stocks will continue to be pressured," adds widely followed strategist Doug Kass of Seabreeze Partners.

That may be the widely held view, but at least one top analyst feels very differently.

I’d buy banks on weakness, FBR analyst Paul Miller tells the desk. I just think a lot of the bank reform is tempest in a pot of tea. What’s really going to drive banks is earnings and eventually Wall Street will grow board with the political rhetoric and realize that.

I particularly like regional banks, Miller adds. Zions , Regions , SunTrust and Fifth Third are my favorite names in the sector.

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Trader disclosure: On January 27th, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Adami Owns (AGU), (C), (GS), (INTC), (MSFT), (NUE), (BTU), (GS); Najarian Owns (AAPL) Call Spread; Najarian Owns (CTXS) Calls; Najarian Owns (GS) Call Spread; Najarian Owns (MS), Is Short (MS) Calls; Najarian Owns (XLF) Calls; Finerman's Firm Is Short (IJR), (MDY), (SPY), (IWM), (UNG), (USO); Finerman Owns (AAPL); Finerman's Firm Owns (BAC) Leap, (BAC); Finerman Owns (BAC) Prefered, (BAC); Finerman's Firm And Finerman Own (GOOG); Finerman's Firm Owns (KFT), (MSFT); Finerman's Firm And Finerman Own (WFC) Preferred; Seymour Owns (AAPL), (BAC), (INTC): Finerman's Firm And Finerman Own (IBB), (RIG)
Finerman's Firm Owns SPX Puts

For Tim Seymour:
Seygem Asset Management Owns (FCX)
Seygem Asset Management Owns (TSO)
Seygem Asset Management Is Short (VALE)
Seygem Asset Management Owns (X)
Seygem Asset Management Owns (PBR)

For Pip Coburn
Pip Coburn Invests In Buckeye Delta Fund
Buckeye Delta Fund Owns (AAPL), (ADBE), (ANSS), (RIMM), Arm Holdings plc, (GOOG)
Buckeye Delta Fund Is Short (NOK), (PALM), (MOT)

For Paul Miller
FBR Capital Markets Is A Market Maker Or Liquidity Provider For (FITB) with wires