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Goldman Raises European Banks From Underweight To Neutral
Goldman has just started selling European bank stocks to its clients, whom it is telling to buy European bank stocks. Said otherwise, the stolpering of clients gullible enough to do what Goldman says and not does, has recommenced. Our advice, as always, do what Goldman's flow desk is doing as it begins to unload inventory of bank stocks. Translation: run from European bank exposure.
From Goldman
Raising banks from underweight to neutral
We are shifting our recommendation on banks from underweight to neutral. We shifted to an underweight position recently. This was based on our view that the economic environment was deteriorating. The combination of weaker growth and the need to shore up balance sheets was, we felt, likely to be a significant headwind and reduce demand for corporate loans while also increasing NPL’s. Furthermore, the sector is becoming more domestic as banks sell assets outside their main markets.
While all of these concerns remain, the new funding arrangements agreed by the ECB and other central banks should significantly help the banks offset the pressures of the economic downturn in our view. The coordinated action by central banks last week has brought a reduction both in the rate (down to OIS+50 bp; previously OIS+100 bp) and margin (down to 12%, previously 20%) while giving commercial banks access to US$ through this channel. In a further positive surprise, the ECB is also now offering banks 3-year liquidity (full allotment, fixed rate), on an expanded collateral pool (which now includes loans) and a lower reserve ratio. According to our banks analysts (see “Capital story is ending, funding receives a large ECB boost” December 9, 2011) the scope and structure of this facility directly addresses the banks’ key funding concerns.
The 3-year duration will address mismatching issues while an expanded collateral pool and lower reserve ratio increase the scope for banks to get access to liquidity. The interest rate structure meanwhile allows banks to detach their funding cost from that of sovereigns, which has been one of the key factors that has kept the risk premium on banks so elevated. As a result, our banks analysts expect a positive impact on margins, deposit pricing and loan availability resulting in a high take up of the facility. While these facilities help to reduce the risk premium to some degree they should be seen against the ongoing deterioration in fundamentals so that, on balance, we feel a neutral in the sector is appropriate.
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Goldman shifted from underweight 'buy' to neutral 'start dumping to the dupe funds'.....allrightey then!!
How do we know Goldman is selling?
Because theyre telling others to buy.
Please, Goldman, please; have Abby Joseph Cohen come out & speak bullishly on Eurotrash Banks AND put a bunch of said institutions on your 'conviction buy list.'
Anyone who believes Goldman Sachs...
Michael McDonald "What A Fool Believes"
www.youtube.com/watch?v=pk9mmto2Cdw&feature=related
Abracadabra!
Run fast, very fast.
http://vegasxau.blogspot.com
All in the clients best interest....
I think I will just push the ¨Ignore¨ button on Goldman Sachs...
What a tangled web of bullshit. So ZH reports that Goldman, DB and you name it have been begging, pleading for the ECB and Fed to print like all holy hell, or else. This agreement has none of that in it, and Goldman is raising their outlook based on this agreement?
Sure. Most likely someone is about to be punished.
Well I wonder if they can con any suckers into buying? Time to go short.
that is sick and shameful
Sick and Shameful is just a branch of Goldman Sachs.
They acquired Sick & Shameful, LLC when they merged with Smoke & Mirro in 2003.
Its Goldman Sachs, the Synogogue of Satan.
Tyler
Do you mind creating a permanent video link to some of the trader pits to confirm that there are people actually buying and selling and not some janitor playing a computer game in a basement office? I find myself less and less able to believe that individual people are actually participating.
Thanks in advance.
there are no more pits.....its all done via algo's
SPY erased yesterdays losses now. I bet Robo has a hardon today.
that's just his chapstick...
+ 1
Excellent LOL there, Cap´n!
Goldman rightly points out that the interest rate structure delinks sovereign and finance sector risk, which is what the S&P wants to see from the EZ in considering them for a rating change. But it seems crazy to say that this will offset the pressures of the economic downturn. The summit, infact, did nothing to plan a growth strategy, and will surely (I am100% certainhere) reault in a slew of S&P downgrades because of that. Besides GS has its eyes on running the secondary offerings for all of those EU bank; no doubttheyhave to upgrade for that sucker feeding fest.
'stolpering of clients'
Hehe. Jeez you didn't even capitalize(unintended) that putz' name...
Yeah, I had to Google that one. Thought maybe it was a new word in the Urban Dictionary for corn-holing.
"and it's more than a bad dream...now that I'm sober"
Tom Waits
More Than Rain
equivalent to a Stopler call of EU/USD 1.50!
lol, WINNING!
== It is a SIN to leave the mark with a cent of their money. ==
W. C. Fields
just another slow algo grind higher...wtf
The pension funds announced just last month that they were suing all the big banks, including the squid, over claims they all misrepresented MF Global exposure to Europe. I'm sure this is nothing like that though. :roll:
http://www.bloomberg.com/news/2011-11-18/u-s-judge-says-he-will-approve-...
I just can't stop laughing as I watch the /ES rip higher and higher despite the clusterfuck in
Europe. This has gone way past tragic...it is now officially an absurd comedy.
I think I'll purchase Euro bank stocks now....NOT
Who cares what Goldman says? Crooks.
So what has been accomplished in Europe? They have agreed to give 200 billion to the IMF....other than that nothing other than ruling out printing money through ECB (which is a huge negative for inflation). Oh, and where is that 200 billion euros coming from????? What country in the Euro zone has the big fat savings account to tap into??????
Today the robots are buying and selling to each other with an upward bias program switched to "on".
wow...just...wow
I gues when the interest rates in Europe start to rise next week I guess that is when stocks start heading down again?
Insane
after running a marathon away from euro banks, may i suggest y'all keep running, 'cause the american banks are right behind!
So did this 'recommendation' cause the banks to go higher and thus trigger the buy buy buy bots in Europe?
Goldman's well connected head of global strategy Peter Oppenheimer has this morning re-upgraded the European Banks sector having downgraded the sector just a week ago to underperform. What has inspired this remarkable U-turn by the euro-Squid? The pretext is laughably that the (already highly predictable one week ago) ECB liquidity measures trump the fact that European banks are insolvent by any normal (non-European) stress test measures. The real reason? A wall of highly profitable (for underwriters, not the mugs who subscribe) Euro bank capital raising excercises beckons. Even the shameless squid can't send its salesforce into battle to tout stocks its strategist is telling you will underperform. No doubt Peter's partners observed the downgrade with horror and he was taken aside and told in no uncertain terms to reverse the move prontissimo. Expect the European bank sector to ramp further on this specious 'liquidity problem solved' rationale into the year end and then be braced to go short in Jan just ahead of the tsunami of Goldman sponsored new bank equity hitting the market. How much will the weary institutions absorb before the sector crashes well below the 2008/9 lows carrying a raft of newly unhappy bank shareholders with it? Maybe the Arabs and the Chinese won't be fooled twice after their 2008 hosing. In my view the Euro bank sector needs at least EUR200bn of new equity capital. Hurry up Banks while stocks of gullable idiots last! First come, first served.
Perfect signal to sell:)
S&P Euro bank cut incoming
I better buy them before the cut. Dam.. I am going to miss it if I don't
Translation: The US will join Europe and throw everything and the kitchen sink at keeping Euro banks solvent.
http://confoundedinterest.wordpress.com/2011/12/09/europe-moves-ahead-with-fiscal-union-uk-declines-europe-buys-more-time-with-bailout-and-vague-promises-of-budget-cuts/
NEUTRAL has and always will be Wall Street speak for SELL
well, goldman did just acquire the EU so of course they are going to pimp it...
Yup, the EU is the new prop trading desk of GS with the FT as their boilerroom division.
As an aside (well, maybe not):
"I want to emphasize again how important it is to the United States and to countries around the world that Europe succeeds in this effort to build a stronger Europe, and I'm confident they will succeed," Geithner said in France on Wednesday.
Who the hell writes this shit for Timmy? He apparently was able to look the teleprompter right in the eye and say this with a sincere, straight face, so you gotta give him props for acting ability. This makes Pablum (tm) look like hot stuff.
It is also passed off as 'news'.
Theater is one thing, but this is BAD theater.
I may start drinking early today.
Hard to believe the cockroaches still have "clients".
http://ftalphaville.ft.com/blog/2011/12/09/789971/lloyd-c-blankfein-want...
A wily technique, using a "survey" to narrow decision making to "GS is better than the alternatives".
ass-u-me-ing that timmah went X-pond in service to the chairsatan, wtf did he promise tudoodoo for the euroZombies, both corpo-fascist, and their savoir faire-cist polpuppets running the "sovereigns" into the radioactive arms of the ever-grabbing banksters? huh?
my goodness, BiCheZ, it could be anything!
howzabout swapping some underwater mortgages? i'm sorry. fuk them. let them guarantee their own! tranche warfare, right?
cameron got between sarko & angela, and sarko did not like it one bit!
slewie interpretation: the (rothschild) banksters have formed the Axis 0f Paper (US-GB-GER) and france will now be controlled from the top => down, but from the outside. their mission, should they accept it, will be to kiss china's ass and use their money to rebuild libya so china will stfu about surgically detonating various iranian venues. and also to help fund those in dire and ever-increasing need of euroz
timmah turbo lives up to his name, lining up the paper manufactures for the print-fest of sta-biiil-eee-teee for the banksters' NWO
Translation: "Run like hell from European bank stocks because Goldie Shorts is shorting them!"
How does this fit?
Goldman Sachs empfiehlt Wette gegen den DaxIt does not fit. That article is interesting in showing how the Squid's opinion of he summit is the same as German socialists. Also: read the response. Some of those who responded to the article must be ZH readers.
ECB's Noyer is such a cheerleader: someone put him on CNBC with Maria.
The only real question is whether or not Tilson's buying...
Jeeze, do these crooks have any clients left? I mean, any with any funds left? Blankenstein is one sad pile of hyena offal, for sure... needs a beating or three, badly. Jamie, you be next, bro.
Sell Sell SEEEELLLL!!!!1
1 Now
frau merkel has told GS that she will get them special terms to next Russian mega drilling in North Pole zone company stock offering. This ranks with Facebook going public. GS is delighted to find a new life line off US Titanic. So if frau scratches GS's back, the squid scratches the nuts of ze euro banks. voila.
Let the fleecing begin.