MORE ROUNDTABLE

Despite the traders day off - the futures are/were open most of the day and it wasn't pretty as SPX futures are currentrly trading about 13 points below fair value- so tomorrow will probably not get off to a pretty start.

Barrons with more from the roundtable and Abby off to a rip roaring start to 2009- as she picked BAC on January 2 at a price of $14.33- we all know what has happened since- What does she say about this shrewd pick:

"Bank of America common equity is interesting, as well, from a valuation perspective. It yields in excess of 15% because investors are nervous about it. The stock is down 65%. We all know about the banking sector's problems, and credit-cycle issues will take a while to play out. In Bank of America's case, there are three phases to the credit cycle. The first was problems related to mortgages and home equity. The bank had 43% of its loans in the housing sector. The next phase of concern will relate to construction and commercial lending, and the third phase to losses related to consumer loan books, such as credit cards. The bank has material consumer exposure and delinquencies are increasing, but it becomes a question of what is priced in."

This is a controversial stock, and it is priced as one. [Note: According to government and company announcements Friday morning, Bank of America, which already has received $25 billion in TARP money, will get additional funding and a loss-sharing agreement on impaired assets because of problems at Merrill Lynch, which are worse than had been expected when BofA struck a deal last fall to acquire Merrill. As a result, BofA's capital position has been significantly weakened. Bank of America also is cutting its dividend to a penny a share. According to Abby, Goldman Sachs analysts say BofA may have other capital options available as it seeks to reduce leverage. It could reduce stakes it holds in other financial institutions, such as CCB, BlackRock or Itau. Pro forma tangible book value is about $10. Extensive government involvement likely will mean current shareholders aren't a top priority.]

It will be interesting to see if Abby is back with the roundtable next year- I suspect there may be a major overhaul.

Some links:

Market Sci's most popular posts of 2008;

Seeking Alpha on a bio breakout;

BESPOKE on % of stocks above the SMA 50;

SECTOR returns YTD;