Well, Goldman Sachs (GS) and JP Morgan (JPM) are excellent, Wells Farge (WFC)– not so much. And Im unsure I d call JPM “good” as $5.2 Bn of the quarters $14.3 Bn in earnings came from the release of loan reserves that were reserved in 2015 to cover expected loan defaults. Since the Federal Government tossed $6Tn at the economy ever since– it ends up they didnt require the $5.2 Bn to cover bad loans so now the money (which was always in the bank) is moved to the income side of the journal.
Bank revenues are great..
We were far too conservative with GS when we made it a Top Trade Idea for our Members on October 14th:.
I have actually always challenged Loan Loss Reserve accounting because it enables a bank (and numerous other business) to take earnings that have actually already been declared (and currently moved the stock) out of Cash (revealing a loss on need for taxes, housekeeping, etc) and then back to revenues when they feel like it (to increase the stock cost or save a quarter). Especially for Businesses that have the ability to redeem their own stock when the price is depressed due to a loss they deliberately triggered and after that, when they desire to offer more stock or take bonuses– they simply re-recognize the earnings as needed. What a fraud!
