How to Destroy a Bank

[DominiConnor]

In the UK, HBOS, one of the largest mortgage banks has been trashed, some blame short selling, which may or may notr be true.
I share some thoughts about how you could do this on The Register:


Bear squeeze blues: How to destroy a bank • The Register

 

[fortunaire]

banks are easy in all fairness how about a chain of pension funds are a whole country it's been done before pal....let me know if you could add on to what i considere a master peice and brillant asset allocation phenomenon......happy trading

 

[Uncle Max]

All those banks are in a pretty bad shape. That's why they are vulnerable to short selling. If banks had sound balance sheet, nobody would try to short them. However, because banks made so many stupid and risky decisions in the past, they can be easily put down by short. Therefore, short selling just accelerates process of bankruptcy. And this is called free market.

Somehow nobody tries to destroy Wall-Mart or Microsoft by short selling. Because those companies are strong financially and manage their business properly. If a bunch of hedge funds decides to squeeze Wall-Mart, they will miserably fail.

 

[Rinnes]

maxrum (minmorality) said

"All those banks are in a pretty bad shape. That's why they are vulnerable to short selling. If banks had sound balance sheet, nobody would try to short them. However, because banks made so many stupid and risky decisions in the past, they can be easily put down by short. Therefore, short selling just accelerates process of bankruptcy. And this is called free market."

Not so fast.
A free unregulated market in destruction, using duplicates hidden behind legal fine print, dishonest trading, manipulative tactics, is a surefire self-fulfilling strategy while any act of business creation entails endless regulation, onerous taxation, normal market surprises and lots of other real risk on top of which is the unnecessary artificial risk imposed by shorters, bear raids, etc. All short selling is anathma to building civilization, your darwinian argument is bogus. I'm no friend of banksters - short selling is equal sin. Two wrongs do not make one right.
Reference: http://www.stopshortingstocks.com

 

[fortunaire]

All those banks are in a pretty bad shape. That's why they are vulnerable to short selling. If banks had sound balance sheet, nobody would try to short them. However, because banks made so many stupid and risky decisions in the past, they can be easily put down by short. Therefore, short selling just accelerates process of bankruptcy. And this is called free market.

Somehow nobody tries to destroy Wall-Mart or Microsoft by short selling. Because those companies are strong financially and manage their business properly. If a bunch of hedge funds decides to squeeze Wall-Mart, they will miserably fail.

not so necasarily true you can take out wal mart you just have a bigger fish to fry try taking down an insurance company linked to their pensions then you can hit an accounting firm that does their cost analysis etc.... you get to drop 20 points be fore they start to scramble then you wipe out the annutiy polices an distort convertible bonds tied to cheap land and any union dealers in credit wal mart will hit the dirt but they would not be out yet if you can get a hike on a cheap emerging currency you'll hit their private equity investment leaving them to liquidate at a high speed scrambling for tax shelters seems like their safe now huh not really they have left a backdoor open to price their options based on production cost rather than retail now their more broad tighten up that currency now leaves rooms for swap monopoly and their you could short your brains out leaving the tic k at 1.20 per share a nuclear revolution in investments..... sounds good buy who has the buying power can a quant create such wealth.$$$$$