banks Archives - Runnymede Capital Management

Andrew Wang and Nick Colas on What Rising Interest Rates Mean for Banks

Andrew Wang and Nick Colas provide their respective outlooks for the financial sector, including some names they like moving forward in 2021.

Capital One CEO comments on the biggest disconnect between credit and economy ever

Last night on Capital One's 3Q earnings call, their founder and CEO Richard Fairbank made some interesting comments about what the credit card company is seeing in the COVID affected economy. Fairbank has over 30 years experience and has seen many economic downturns so his perspective is invaluable. He said, “This is the biggest disconnect that I certainly have experienced in my three decades of building Capital One between what we see in the economy itself and the actual performance of the consumer, especially from a credit point of view.”

Is your bank still paying you nothing on your savings?

The Fed has been raising interest rates off its emergency levels for the past year and that should be good news for savers who can finally earn a risk free return. However, if you aren't savvy, then your large bank may still be “stealing” your interest by not paying you market rates. Do you know what your financial institution is paying on your savings account? If the answer is no, then you should check their website or your latest bank statement. Here is the ugly truth, Chase and Wells Fargo still are paying just 0.01% on savings accounts. That is robbery as they are pocketing your interest and dropping it into their profits which are in the billions. With money movement a simple mouse click away, you shouldn't allow the big banks to steal your interest.

Why does the market keep going up? It’s earnings.

Last August, Chris visited the Reuters TV set. Yesterday, I had the pleasure of dropping in at Reuters TV in Times Square to talk markets with anchor Fred Katayama. We talk bank earnings, S&P 500 earnings, and Costco.

Black swan watch: European banks

In 2007, Nassim Taleb published his best-selling book “”The Black Swan: The Impact of the Highly Improbable.”” Taleb contends that banks and trading firms are very vulnerable to hazardous Black Swan events and are exposed to losses beyond those that are predicted by their defective financial models. This proved to be right on the mark as one year later, the financial system almost collapsed due to poor financial models that predicted real estate prices would go up forever.

Will Derivatives Be The Next Black Swan?

“It's déjà vu all over again.” – Yogi Berra

The stock market has long been classified by economists as a leading indicator of the economy. It tracks and reflects the nation’s economy and industry fundamentals. The market often seems able to anticipate positive or negative change before it happens. Since the beginning of the bear market in August of 2015, the prices of many bank stocks, especially European and Japanese banks, have declined steadily and precipitously. Deutsche Bank has lead the way by dropping below the level it reached in 2009. Shares of HSBC, Citibank, Bank of America, Credit Suisse, Goldman Sachs as well many other big banks have also taken a beating of 25-45%.