Bank of America Agrees to Buy Merrill
- Thread starter sophiekay
- Start date
I agree and there's MANY short it. Many short it against LEH longs as well. Double toast.
This is bullshit. The Feds probably insisted this deal to counter balance Lehman but there is no way the deal actually closes. I doubt Mer will be able to stay solvent for 3 months, the time needed before the merger can actually be completed. Plus Bank of America is going to get a 60%+ haircut tomorrow. It's going to be bitch slapped down to single digits for taking on all these fake assets but very real liabilities of CFC and MER.
Sounds like one of the big shorts talking.
Bottom line is Merrill has tons of revenues still, which Lehman does not, and BofA has tons of cash. BofA was smart enough to walk away from buying Lehman at $4 after seeing their books, and is paying MER a 70% premium after seeing their books. Sounds to me like the MER doom and gloom was a facade brought on by the shorts who are going to get crushed tomorrow.
I think BofA, like JPM earlier, is buying a significant revenue stream at a major discount. They will have to endure billions in pain first, but in a few decades this will be looked back on as a massive bargain.
I still think the market is going down down down for a long time, but whenever the time comes to buy again, BofA and JPM will be on my list of long-term longs. Don't see BofA ever going out of business.
HEADLINES: BofA agrees to pay 12 dollar premium to MER. MER closes up 1 cent.
Boy...all the newbs thought that they had money in the bank when they bought MER at 21 dollars per share at open this morning...little did they know that by the end of day, they would have lost 20% of the value of their account. Talk about getting sideswiped.
Boy...all the newbs thought that they had money in the bank when they bought MER at 21 dollars per share at open this morning...little did they know that by the end of day, they would have lost 20% of the value of their account. Talk about getting sideswiped.