It seems curious at first when a bank reports losses of $9B, as Wachovia (NYSE:WB) did today, and its stock price isn’t punished. It’s even more counter-intuitive when the company’s stock price goes up, as it did after Wachovia said it lost $8.9B in the second quarter of 2008. Despite the sour news, Wachovia was up over in 15% this afternoon on the New York Stock Exchange. Why are investors rewarding the beat-up bank with a share price boost? A closer look at Wachovia’s recent history helps solve the WB mystery and explains why its investors are still riding high.
More on this topic
(What's this?)
Complexity is the handmaiden of deception
(naked capitalism, 3/5/10)
Meryvn King Calls for Structural Overhaul to Banking Industry
(naked capitalism, 1/27/10)
The Problem That Hasn't Gone Away
(Financial Armageddon, 3/6/10)
