Thursday, September 17, 2009

Cramer, Real News, Fed looking at regional banks, quadruple witching, and more

  • Cramer chimed in yesterday on the IRS guidance and thinks everyone should go long IYR. This is a horrible idea. Why would you buy IYR?!?!?, which is long equities with a TTM yield of 8.4% - this is a horrible risk-adjusted yield. It's lower than the yield on a safer corporate REIT bond. However, some of the other plays could be interesting in that link - NLY, for instance, has legacy issues, but also is buying distressed bonds in the current environment - that is a good play. CreXus has an upcoming IPO that is interesting for similar reasons.
  • Multiple reports have been out the last 48 hours about the Fed Examining the CRE portfolios at banks. Hopefully this isn't something new they started, but just a frenzy of reporting on something the Fed does a whole lot of. However, if they are really stepping up efforts, how long will it be before they realize they propped up the wrong market (CMBS) while ignoring the very real near-term maturity risks that lie on bank's underwater CRE and construction portfolios?
  • Outside of CRE, we get the NG storage report in about 1/2 hour, tomorrow is Quadruple Witching

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