Project for Philosophical Evaluations of the Economy |
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Small Cap Regional Banks have recently increased their stock market value
Observation, first drafted on March 18, published on March 19, 2008
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Noah denkt™ would like to inform all those who keep telling us that further mergers in the banking sector are an
absolute necessity that some regional small cap banking stocks (such as National Bancorp, M & T, US Bancorp)
have been able to withstand the current turmoil in the banking sector and that in contrast to their super-sized
peers it is these small financial institutions who have even been able to increase and not to decrease their value.
What lessons do we have to draw from this ?
Please, Messrs Wiseguys, would you help us out on this? We simply cannot do without the superiority of your
insider and expert judgment.
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Observation, first drafted on March 18, published on March 19, 2008
------------------------------------------------------------------------------------------------------------
Noah denkt™ would like to inform all those who keep telling us that further mergers in the banking sector are an
absolute necessity that some regional small cap banking stocks (such as National Bancorp, M & T, US Bancorp)
have been able to withstand the current turmoil in the banking sector and that in contrast to their super-sized
peers it is these small financial institutions who have even been able to increase and not to decrease their value.
What lessons do we have to draw from this ?
- Is it that we should continue to believe that diversity is not an asset in a free market, but that it is better to
create oligopolistic conglomerates such as Citibank to compete in a global market?
- Or is it that these small cap regional players are jokers by default and you therefore cannot take their
performance serious anyway?
- Or is it that some career jokers tend to jump on any bandwagon that there is to further their executive
privileges so that you in turn can discard their views by default?
- Or is it that the financial markets aren’t as globalised as its mouth pieces like to make us believe, so that it
is easy to increase your balance sheet in some regional niche when other bigger guys seem to get beaten
all over?
- Or is it that no one really knows what is going on and that it is a freak show anyway what the markets are
doing to us?
Please, Messrs Wiseguys, would you help us out on this? We simply cannot do without the superiority of your
insider and expert judgment.
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Addition to this comment made on June 7, 2008: It should be noted that by now small cap regional banks, with only a few exceptions (such as Mechanics Bank), have taken a beating at the stock market too. Nevertheless their beating, at least so far, has been considerably less bloody than that which the big banks (Citi, Bear Stearns, Lehman etc..) have received. |