Quote:
Originally Posted by Enoch Root
Things don't go straight up, they ebb and flow. Higher interest rates MAY be good for the banks, but they may also be disaster (if they result in significant bankruptcies). Regardless, stock prices won't just keep going up and up and up without dips.
And the banks just enjoyed about a 15% jump in about a month. This 'sell-off' has brought us all the back down to prices not seen since about Jan 12th!
What exactly are you expecting?
|
There's an equilibrium you're alluding to, but the rates shouldn't increase to a point where there will be a significant amount of bankruptcies. I guess what I'm talking to here is with the news of increased rates, it's a generally positive aspect signal in favour of the banks. To this point banks have arguably undervalued P/E-wise. I think some would argue they've been undervalued for years as a whole. The recent run up over the past month and a bit has brought where it should have been all these years, and with the recent expectation of increased rates more money should flow in, now out. At least that's my thought personally.