BAC Capital Plan Approved...JPM & Goldman Flagged

[Parsad]

Yes, Sanjeev was right about the rally and he got paid today.

 

We only put 1% of the fund in it...so it was nice, but not life-changing.  We don't have kehones (sic) like you Eric!  Cheers!

[berkshiremystery]

Yes, Sanjeev was right about the rally and he got paid today.

 

We only put 1% of the fund in it...so it was nice, but not life-changing.  We don't have kehones (sic) like you Eric!  Cheers!

 

Sanj,... I knew this short therm trade had a very high probability to be extremely successful, if someone loads up with an extrem short maturity,... almost like front running on insider news. Like Ericopoly did years ago with FFH, at the day of the short sale ban, and also with the ORH trade. Watch out,... there might be some similar opportunity in the next 12 months, before the first dramatic dividend increase.

[UK]

Anyone know if Warren's done this at other investments like Wells Fargo, Amex or others?

 

http://news.yahoo.com/wells-fargo-boss-talks-bank-174027047.html

 

—Warren Buffett is your biggest shareholder. (His conglomerate, Berkshire Hathaway, holds an 8 percent stake in Wells, about $14 billion worth, according to financial data provider FactSet.) Tell us about that. He reads everything. One time I talked to him on a Monday, we'd put out our 10-Q (a quarterly financial report) on a Friday, and he said he spent all day Saturday reading it cover to cover. I said, 'Warren, you do that often?' He said, 'Oh, I love Q's.' He was asking me about some esoteric asset — I was blown away.

[merkhet]

There must be some sarcasm that I'm missing here.  The company has announced that they are retiring expensive preferred stock and buying back shares below tangible book value and book value.  I don't know why this is a bad thing.

 

Even if you're a LEAP buyer, and you're unhappy that you'll have to roll forward you LEAPs and incur frictional  cost, you have to then balance the accretion to your book value per share and dividend yield per share against the frictional cost.  If the stock price treads water for the next 9 months, and you bought at-the-money calls two years out, you should be able to roughly trade time value erosion for the book value per share and dividend yield per share increase...

[Grenville]

Anyone know if Warren's done this at other investments like Wells Fargo, Amex or others?

 

http://news.yahoo.com/wells-fargo-boss-talks-bank-174027047.html

 

—Warren Buffett is your biggest shareholder. (His conglomerate, Berkshire Hathaway, holds an 8 percent stake in Wells, about $14 billion worth, according to financial data provider FactSet.) Tell us about that. He reads everything. One time I talked to him on a Monday, we'd put out our 10-Q (a quarterly financial report) on a Friday, and he said he spent all day Saturday reading it cover to cover. I said, 'Warren, you do that often?' He said, 'Oh, I love Q's.' He was asking me about some esoteric asset — I was blown away.

 

Interesting stuff! Thanks for the link!

 

[ERICOPOLY]

Even if you're a LEAP buyer, and you're unhappy that you'll have to roll forward you LEAPs and incur frictional  cost, you have to then balance the accretion to your book value per share and dividend yield per share against the frictional cost.  If the stock price treads water for the next 9 months, and you bought at-the-money calls two years out, you should be able to roughly trade time value erosion for the book value per share and dividend yield per share increase...

 

That's pretty much the way I look at it too.

[Sunrider]

Hi Eric

 

Picking up on your example earlier in the thread and for clarity (or completing the example) - are you basically saying "take 12$, and today buy 2 2015 12 calls at 2, then worst case spend 2 for 2 again in 2015, and once again to get to 2019' (roughly speaking, common and calls obviously moved up a bit). Is that the plan? So if the stock treads water for two years, you lose 4 (worst case), if it continues treading water to the 2017 roll then you lose 4 again. You've then spent all your cash. At 2019, if the common is above 12 + 12 = 24, you're making some money.

 

If the common declines between the roles you buy more than 2 calls (either because you can get them cheaper, or you chose to trade down on strike for similar cost/number). If the common is above the above in 2019 then you make a bit more money ..

 

.... does that capture it?

 

Thanks - C.

 

[wescobrk]

Can Moynihan buy stock today or does he gave to wait till April 1st?

 

As a side note, it'll be interesting to see how the stock reacts to the fed meeting minutes tomorrow. The last time the stock went down double digits. It would be nice to see if Moynihan can buy now below tbv or if he has to wait.

 

Thanks!