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Hello Crazy Chums,
Banks are a bit difficult at the moment. Which way do you go? Do you expect them to have learned from recent mistakes? Will they now start to make big money again?
Or do banks have more bad news to bring us? Does the US mortgage caper mean that the UK banks could still see more falls in their share prices?
My own opinion is that the damage can now start to be repaired. And such is the money-making ability of bank big cheeses that the profits will soon roll in again, perhaps bigger and better than ever before.
A lot of people don't agree with me, though. You only have to look at the ShareCrazy bulletin board to see that there is still a lot of wariness about bank profits. I don't blame these critics. Transparency is not a great asset among the banks. Not among most firms, actually.
But some people in the Big City do agree with me. Otherwise, the recovery in bank share prices would not have started. Last week saw some nice bank gains - and this week has also begun well.
Remember too, that money invested in bank shares traditionally attracts some big dividends. A nice little bonus twice and sometimes four times a year. Lovely.
Some of the price to earnings ratios of banks are rather juicy now, following the recent falls, so these dividends might still be very desirable in the next few years. So all in all, gang, I will not ditch my loyalty to banks - even though they've let me down since the summer. Rocking on!
To find out more about Malcolm CLICK HERE
UKSA is the leading independent organisation for private shareholders in the United Kingdom. It campaigns to protect your rights as a shareholder and runs educational activities for members.
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