Hot Topics

A look at the stocks our bloggers are buying, selling and discussing:

The Five Biggest Mistakes Investors are Making Right Now.

In this market, maybe the majority (those bears!) doesn't always rule.

Vad tells us to "get ready for more bank failures".

Start your own discussion and see what your fellow InvestorPlace blogs members have to say about a particular stock or investing topic in our Stock Talk section. Or jump in with your own thoughts and answer someone else’s question. click here

Articles

Why?

Shares of Citigroup are up another 3% on Monday, flowing Friday's better than 8% rise. My overriding question is why? Investors seem pleased that the banking and financial services giant lost less than Wll Street expected. The Street has not gotten anything right on the bank stocks all year so why being worng about Citigroup is a cause for optimism escapes me. The fact of the matter is that the report was simply awful. Is the fact that a company that has lost over $40 billion in the last year ONLY lost an additional $2.5 billion really a bullish case for its stocks? Look at some of the "highlights" of Friday's earnings report:

Revenues, down 29%
Expenses up 9% year over year
$4.4 billion in Credit losses
Loan Loss provision increased $2.5 billion
Third straight losing quarter
Increased credit card losses
Increased auto loan losses
Total assets down $99 billion

At least one large shareholder was skeptical of the results. One of the largest unions in the united sates, the American federation of State, County and Municipal Employees urged the bank to just give up and break the company up into separate division. The union sent charman Win Bischoff a letter stating that the bank was too large and unwieldy to over see and should be split up.
Speaking of Bischoff, he told investors over the weekend that he thought housing prices in the US and Britain could continue to fall for the next two years. This is unfortunate as a continued housing decline is going to continue to wreak havoc on his bank's balance sheet until they stabilize. He also told the BBC in the interview that he thought the credit crunch would last 2009.

If Citigroup's chairman does not think it is going to get better, why does Wall Street?

Bull/Bear Report -- Is WYNN a Win?

Is it time to buy shares of battered casino stocks? Frankly, given the lure of gambling no matter what the economic conditions the question should have been more direct, why not buy casino stocks?

Investors have forgotten that historically, casinos have done well in good times and bad. Gamblers can counted on just like any other addiction. Look at cigarettes and the massive taxes smokers pay for their vice for evidence of this.

But this time around things may be a bit different. Over the last two decades casinos have become much more than just rooms filled with addicts throwing away money. Today, casinos are destination resorts with a more diversified revenue base.

As such, a slowing economy could have a very real impact on performance. Obviously we are seeing that anecdotally as Las Vegas appears to be suffering from a glut of room space based on the increasing offers of low priced rooms.

In the case of our stock of the week, Wynn Resorts (WYNN) though its performance is tied to more than just Vegas. Instead, growth in China and the development in Macau will have a significant impact on the future of WYNN.

Get the rest of the story on WYNN here...

An end in sight?

It seems like it will never end. The situation in the banking industry just keeps getting worse. No matter how often pundits and prognosticators declare the bottom, the news keeps getting worse and the stocks continue to decline. Bank Indexes fell as much as 10% on Monday amidst the troubles at Fannie and Freddie. We have even had the first run on the bank in the US in decades as depositors clamored to withdrawal their money from IndyMac bank. The FDIC seized Indymac this week, marking the largest bank failure since Continental Illinois in 1984.

This morning we have even more bad news. Citigroup CFO Gary Chittenden lay to rest any talk of a near term turnaround for Citi. He told investors today that it will be two to three years for the impact of asset sales to make a difference. It will be at least that long, he said, before earnings begin to improve in any significant manner. He added that the turnaround would be a marathon, not s sprint. Citigroup is expected to report a $3billion dollar loss for the second quarter adding to its impressive streak of losses in the last year. The bank has lost $46 billion since the crisis began last August and has raised a staggering $40 billion of new capital to keep the doors open. There are concerns about Citigroup's ability to continue raising the capital it needs since those who put money into the bank in the first go round have lost as much as 505 on their capital.

Click here to find out who else is in trouble and what the future holds...

From hundreds of InvestorPlace bloggers...

...comes 10 of the absolute best stock opportunities

...in 1 very special free report.

The Top 10 Stock Opportunities in a Topsy-Turvy Market.

There are profits to be made even in this topsy-turvy market …and we'll help you make them!

Get a fresh take on investing along with the best stocks to buy, sell, or hold.

Get your copy today!