ANYONE KNOW WHY THE ROYAL BANK OF SCOTLAND IS SHOWING A SHARE PRICE AROUND THE 6.59 MARK WHEN IT WAS 18.00 OR SO THE OTHER WEEK OR AM I GOING STRANGE?????????????

last bear market was by events fro dot com, trade towers, iraq war.

this is a banking crisis / housing at present. i think we had one in 1970s.
agree that iran would hit markets big......but if i does happen, it wont happen till after nov as israel will wait till adter us election at least.

in which case, its early next year......but when iraq war started, it only lasted a short while....and israel will only target nuclear facilities, not major cities etc.....so dont think the impact will be as bad as you might fear

An experiment was done in NY with the 10 most successful hedge fund managers, and a gorilla(from the zoo I think)

Teh gorilla was trained to throw darts at a dartboard that had a top selection of companies/commodities/currencies etc.

Teh hedge fund managers were given the same investments to work with.

Over a period of time-several months I believe, the gorilla was outperforming the HF managers by 30%.

The moral of the story is....DON'T MESS WITH IT, EXPERTISE IN THESE MARKETS COUNTS FOR NOTHING

from FT Alphaville this AM:

downgrade from Cazenove:

The level of Aprils cash call pricing, 225p, was first surrendered a month ago. But after an aggressive sell-off on Monday, RBS shares are now more than 12 percent adrift of the price at which the bank raised 12bn.

The reason? An aggressive note on Monday from Simon Pilkington at JPMorgan Cazenove, slapping an underperform rating on the stock.

The analyst notes that RBS, with a loan book of 176bn, is more exposed than its domestic peers to a UK slowdown. Also, impairments to date have been relatively low and - putting RBS on a level with Barclays - Pilkington reckons the charge will rise by almost 3bn through to 2010, slicing 12p off earnings.

The really worrying bit:

We reflect a weaker economic outlook, but not a full recession. A return to a 1992 scenario would cut earnings by a further 17p or 54%.

And then there is ABN:

ABN represents one third of the balance sheet of RBS yet it will add just 1% to EPS by 2010E, on our estimates. It is not the prospect of a dismal return on investment of 7% that is our main concern. The large balance sheet has the curious characteristics of a high income yield, but a low risk weighting for regulatory capital, which we do not regard as sustainable.

If successful, the disposals would lift core tier 1 to 6.5%. There is uncertainty over the quantum, but broadly we expect the pro cyclical effects of Basel II to keep the ratio closer to 6%.

We expect the disposals to dilute EPS by 11% leaving RBS at a 30% premium on PER 2009E. The price/book at 1.2x is low and, in equilibrium, could be justified by the expected return of 13% in 2009E. In common with the sector, we see the risks to estimates still lie to the downside but, given its exposures, feel that the newly gained premium valuation of RBS will erode. We change our recommendation to UNDERPERFORM (from In Line).

Pity post 217 didn't follow 218 instead of the other way round. It's a load of grief no matter which way you look.

yell was tipped by a broker end of march to go 350p.....its now under 60p....pity the poor sods that buy cos of stupid brokers or so called analysts.....analysts r just journalists

Nice post 217 Scot!

Looking at my shares, I need a laugh atm and that made me laugh.

Yes, but it was true (Scot post 217), although the experiment was actually conducted in 2000.
http://www.mgmt.purdue.edu/faculty/rau/funny/DartThrowing.html
It was on TV about 3 to 4 weeks ago.
Perhaps they should get such an IQ primate to run the country. Oh they have.

gordon the gorilla has a minus iq unfortunately

Brokers don't seem to know which way to turn, the only Broker that has been consistantly correct with it's Bank forecasts is Sandy Chen at Panmure Gordon. He gave a very downbeat assessment of the banking sector in August 2007 and was pretty much spot on.

The last update for RBS was on 23rd April, which was a sell and price target of 195p, again he has been proved correct. When Sandy Chen changes his stance, then I will take notice and increase my exposure further.

Now that the sp is close to his target it will be interesting to see if we have another update.

Yes Sandy Chen is a regular guy/girl 190p today and falling.

how much further does anyone think they could go before they are in serious trouble ?

As I have already said, RBS won't go bankrupt because if they do it will be the end of Capitalism ie all banks go bust, all builders go bust therefore estate agents (already happening), all support companies such as recruiters etc etc.

After saying that, if things get worse will they need to raise even more capital?

I've got loads of RBS (inherited) and therefore have loads of rights!
When the sp goes back over 200p, I'll probably sell the rights and then wait.

I'd then prepared to miss the first 10% of recovery just to make sure when I do buy back in, the sp will be travelling in the right direction.

Shorting distorts the markets.

If you agree, cut and paste this to your favorite threads and don't forget to sign.
http://petitions.pm.gov.uk/shortsellsecy/

We the undersigned petition the Prime Minister to MAKE IT ILLEGAL TO SHORT SELL STOCK EXCHANGE SECURITIES

When prices go down and all is doom and gloom, it is very easy to look for scapegoats. To have the facility to short is a very useful tool, as is a facility to go long. The only reason that bank shares are falling is the poor past action by management. If you need to direct your anger at someone, then the management of these banks would be a good place to start, it is disgusting how they are paid a golden handshake of millions, when shareholders are left carrying the can.

I am a holder of lloy and rbs, and haven't shorted either.

shorting makes it worse though

in that case, everyone in uk should be shorting most shares as vast majority are going down

hopefully uk will collapse as thats what most people want in uk as they kept on voting labour....people want to live in abject poverty

It may make the price worse short term, but there will be a point at which these people will reverse there short, and then prices could increase very sharply.

As for the people who voted for this Labour Government, maybe they could be forgiven for one term, but as we should have all knowed from the 70s Labour will always revert to Tax and Spend, and surprise surprise now we have a financial crisis and recession, we have a huge budget deficit at the worst possible time.

Now I know that this Government wasn't responsible for this recession, like the conservative government wasn't responsible in the early 90s, but at least we had reserves to re-inflate the economy then.

I haven't heard much comment from people who keep voting them in again and again, our economy has been so damaged by this government, as you can tell you shouldn't have got me started on this scotinvester, now I have had my rant I will go and have a stiff drink.

I will cut and paste this to Gordon Brown thread, rather than clutter this one up with this subject.

Whats with the we love Sandy chen?

He is the same as Paul Kavanagh in the dot com bubble.

Panmure Gordon were saying buy RBS at 600p pre crash and now say sell at 200p. Great advice to follow. Maybe if you did the opposite you will be better off.

Have a look at article from the Share mag on 16th August 2007, and you will see he wasn't far off the mark. See below............

UK banks have been slow to confess how exposed they are to the current bad debt crisis but an apocalyptic note from stockbroker Panmure Gordon suggests they could have around 80 billion of loans at risk.

Banking analyst Sandy Chen says these debts are wrapped up with many others in exotic packages ranging from Credit Derivative Products (CDPs) to Asset Backed Commercial Paper Obligations (ABCPOs)

Too much cheap money has resulted in over-lending to high-risk borrowers. Worst of all, the banks dont know what is in the various packages and the extent of their liabilities. The Bank of England last month instructed the clearing banks to clean up their act. They were given the quarter day as a deadline (September 31) to identify and write-down bad debts. Some of these loans will have to be taken on board by the banks.

Chen says the European bank with the largest exposure is Dutch giant ABN Amro with 27 billion. So buying the bank for around

40 billion could prove a poisoned chalice for bidders Barclays (BARC) and Royal Bank of Scotland (RBS).

Barclays is already up to its ears in dodgy debt, says Chen. He estimates it could be owed 25 billion substantially more than its capital reserves of 19 billion which would make it the most exposed UK bank.

RBS is relatively safe with only 6 billion at risk, representing a sixth of its capital. Lloyds TSB (LLOY) has 11 billion poor quality loans only a fraction under its 11.5 billion capital. HBOS (HBOS) has

20 billion and 22 billion capital, while giant HSBC (HSBA) is not too exposed at 15 billion against 55 billion capital, according to Chen.

The good news is that probably just a fifth of these low-quality loans will never be repaid, totalling some 15 billion and spread over several years. But banks will need to raise extra capital from rights issues and/or selling stakes to better capitalised competitors in the Far East.

Chen has had to field some irate phone calls from the banks after his estimations. The problem is there is no disclosure. There is a lack of clarity about their ABCPOs and likely asset impairment charges. The over-arching risk is the drying up of liquidity. The banks will probably have to use their cash to top up their own products, which means less to lend to companies, he said.

Shares says: A fully blown financial crisis is still unlikely but the banks will come under more pressure.

good artcile.......typical of shares mag to give wrong prediction in last line though.....it is a financial crisis in uk and in government and with people debts and negative equity

Speculative Buy.