BAC buying CFC, why did the entire stock flea market move up because of this?
I understand 50% gain surrounded by CFC but I don't understand why the entire marketplace move upAnswers: Whoa.. not so fast.
BAC isnt buying Countrywide..on the other hand
Here is the quote from the WSJ
The Wall Street Journal reported that Bank of America is in advanced parley to acquire Countrywide Financial. It isn't clear how soon a deal might be struck, and it's still possible that no business will be ultimately forged.
The market have been oversold for several days, and the Bernanke speech at 1PMET did closely to quell some fears, though it did sell stale again. I think it's freshly a bunch of short covering as folks believed the market be in free spatter. Apple fell $1.38, so I think its somewhat constrained to financials and large cap.
Let see what happens tomorrow beforehand we break out the hats and horns.
Another intention for the upswing is because Ben Bernanke (Chairman of the Federal Reserve) pledged to cut the Federal Funds rate again at the Jan. FOMC meeting. This will gross it cheaper for banks to borrow money from respectively other, which is also why I think the BAC/CFC word followed.
The markets overall see Merger & Acquisition communication as a positive, especially in the Finance sector (see effect on ETFC/AMTD merger rumors). This antipathy is par for the course
The markets move up and down base on rumors and expectations. One speech, remark in a conference call upon or rumor of merger can send traders to their computers. That's why chasiing day by day ups and downs is futile for the small investor.
What is expected by a steepening bond let go curve?
I thought you only made money rotten the interest in a bond. Are in attendance other ways to make money sour from Bonds?Answers: What it means is that the longer occupancy rates are moving up. This is called steepening. If the short occupancy rates are higher later it is called an inverted verbs curve. Try to imagine the graph, beside maturity on the bottom (X), and rate on the (Y) axis.
Bond prices and interest rates own an inverse relationship. You can make money on bonds surrounded by two ways - interest and changes within price (assuming you don't hold to maturity). Steepening yield curve ability increasing spread between short and long maturities, say between the 2yr and 10 yr bonds.
If Bank of America have troubles near subprime after buying CFC, will they enjoy to provide stock to cover losses?
As the market deteriorates from default on subprime loans going bad, will Bank Of America necessitate to sell performing stocks surrounded by the market they own as investment property to cover their losses surrounded by subprime and to keep their wall business up and running?Answers: They might. It's a possibility.