The problems banks have with mortgages will take a long time to be solved and bank stocks are not attractive despite the recent drop in price, Jim Rogers, chairman of Rogers Holdings, told CNBC Wednesday.
Jim Rogers is author of A Bull in China: Investing Profitably in the World's Greatest Market
, A Gift to My Children: A Father's Lessons for Life and Investing
, and Hot Commodities: How Anyone Can Invest Profitably in the World's Best Market
Rogers thinks the G-20 is a waste of time, and "will only be good for the twenty people that show up.
Rogers specifically pointed of Bank of America. Rogers noted that the banks had much problems which might take 5-7 years to work out their problems . He is scared of the liabilities for mortgages that the banks might have to buy back. He thinks this could cause a large decline in book value. He also thinks the current balance sheets are pretty bad.
Although, Rogers mention BAC by name, he also said that many other banks had the same practices of Bank of America and will now pay the price. Although I am afraid Rogers is right, one good aspect to note is that the banks are a lot less leveraged than they were two years ago. Banks are hoarding cash so even if they have to take losses many are well capitalized for any possible write downs.
The video is below:
Disclosure: Long WFC
http://www.valuewalk.com/
Jim Rogers is author of A Bull in China: Investing Profitably in the World's Greatest Market
, A Gift to My Children: A Father's Lessons for Life and Investing, and Hot Commodities: How Anyone Can Invest Profitably in the World's Best Market Rogers thinks the G-20 is a waste of time, and "will only be good for the twenty people that show up.
Rogers specifically pointed of Bank of America. Rogers noted that the banks had much problems which might take 5-7 years to work out their problems . He is scared of the liabilities for mortgages that the banks might have to buy back. He thinks this could cause a large decline in book value. He also thinks the current balance sheets are pretty bad.
Although, Rogers mention BAC by name, he also said that many other banks had the same practices of Bank of America and will now pay the price. Although I am afraid Rogers is right, one good aspect to note is that the banks are a lot less leveraged than they were two years ago. Banks are hoarding cash so even if they have to take losses many are well capitalized for any possible write downs.
The video is below:
Disclosure: Long WFC
http://www.valuewalk.com/
