So we have:
- Citigroup (C) getting $7.5 billion from Abu Dhabi and most likely $14 billion more from Singapore's GIC - the Government of Singapore Investment Corp or Prince Alwaheed or China. Point is someone wants to give them billions.
- Bank of America (BAC) buying Countrywide (CFC)
- JP Morgan (JPM) possibly buying Washington Mutual (WM)
- Bears Sterns (BSC) and CITIC exchanged stakes
- Merrill Lynch (MER) received $5 billion from Singapore's Temasek and may be getting more soon.
- News from Berkshire Hathaway (BRK) is that they may partner or buy a bond insurer like MBIA (MBI) or Ambac (ABK)
So does this means the financials index (XLF)has nowhere to go but up? No, there may be a little more downside from here. It does mean that there will not be much more significant downside though. Currently trading at a 5 year low the sector as a whole is vastly oversold.
Disclosure:Long Citi, None in others
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