Housing: Bank of America CEO
Bank of America CEO Ken Lewis made some interesting comments on housing yesterday. From MarketWatch.com:
Lewis becomes the third CEO at the nation’s biggest banks to report his company was profitable in the early part of this year, joining JPMorgan Chase & Co. and Citigroup Inc. He has promised the Charlotte, North Carolina-based bank will get through the credit crunch without more help from U.S. taxpayers.
Bank of America Corp. anticipates recording more than $100 billion in revenue and $50 billion in profit, prior to taxes and necessities, this year and has been advantageous in January and February, Chief Executive Ken Lewis said Thursday
“Housing is particularly most significant factor,” Lewis said. “Housing may be bottoming. We’re looking for house prices to calm down. So the first sign of an improving economy would be that housing is stabilizing.
Bank of America shares leaped more than 14% to $5.47 in afternoon exchange, marking the third straight day of profits for the stock and shares of Citigroup and J.P. Morgan. All three banks in recent days have similarly reported a profitable start to 2009.
I love the logic being used. I’m sorry, although I pay close interest to housing data. There is no sign of a bottom occurring in 2009 (except in Arizona and Nevada). This is just another illustration of wishful belief among people who want there to be a bottom in housing. Financial professionals have been predicting a bottom since 2005, yet they keep being wrong.
Posted by Carlos Sagastume on March 15, 2009. Filed under HUD Homes.
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