Bank of America slumps on Europe, Congress and Protests

Shares of Bank of America Corp (NYSE: BAC) slid another $0.18 today to close at $5.90 on European Contagion fears, slicing through formidable support at $6.00.   A report from Fitch sparked a sell-off in equities across the board.  Money flowed quickly out of stocks and into U.S. Treasury Bonds.  The credit markets have been saying for months that U.S. financials are in serious trouble.  Prices on Bank of America’s 5 year CDS rose 9.17 to 396.4, well off its low from earlier in the month.  According to their latest 10-Q SEC filing they have over 6.5 billion in net exposure to Italian Sovereign Debt.

Along with the Fitch report, U.S. House Rep. Darrell Issa (R-Ca), Chairman of the House Oversight Committee, told reporters on Wednesday that their probe into Countrywide’s VIP-loan program known as ‘Friends of Angelo’ has uncovered, “… significant additional findings.”  They will likely be publishing their report before the end of 2011.   Countrywide was acquired by Bank of America in July 2008.

“We think Countrywide needs to be held accountable for clearly using their discounted loans for influence-peddling,”  Mr. Issa said.  This investigation has potential ramifications for current members of Congress over possible ethics violations.

If all of this was not enough Bank of America became the target of  “Occupy San Francisco” protesters.  They took over the lobby of one Bank of America branch on Tuesday.  Riot police are on the scene.

Previous Post »  
Tags: , , ,
Tom Luongo

About Tom Luongo

Tom Luongo is a professional chemist and self-taught economist who has been following and trading stocks for nearly 12 years. He has no formal ties to the financial industry and considers that an asset in his analysis of the interplay between monetary policy and capital markets.

Comments are closed.