Bad home loans sparked a bear market in bank stocks this year. How will the credit crisis evolve in ’08?
CNBC’s Charlie Gasparino joins the panel for this conversation. Following is a synopsis of his main points.
In my opinion the first half of ’08 is going to get worse because the market will see the writedowns from Merrill Lynch and Citigroup , says Charlie Gasparino.
Charlie's '08 Predictions
Merrill: $15B+ Some
Citi: $20B+ Massive
Jeff Macke doesn’t agree. I think the trade is to the long side, he says. Although these banks have problems, they always find liquidity. I don’t think this is a terminal problem but their stocks are trading like it is.
The core business of Morgan Stanley , Goldman and other investment banks remains strong says Pete Najarian. I believe they’ve turned and now is the time to buy.
Dylan Ratigan says the bottom line is that investment banks will soon have their moment of reckoning. The news could get worse but the traders are more optimistic on financials than they have been in months.