The sudden, catastrophic collapse of Silicon Valley Bank (SIVB) has struck fear in the hearts of many — shaking up the banking sector and leaving us wondering if we’re headed toward another 2008 financial crisis.
But just like the pandemic – when the media was accused of creating COVID-19 hysteria – it appears this so-called banking breakdown was classic fear-mongering by the liberal media once again.
Mark Skousen saw right through this, as you’ll soon find out…
What was an isolated incident impacting a couple of financial institutions was painted as a “run on the banks”…
…Orchestrated to show the American people that the government had our backs and our money was safe.
The reality is that several of the banks that crashed out over the last week were actually experiencing INFLOWS.
That’s right… people were depositing money in them.
No wonder we saw a massive snapback in prices. It had nothing to do with what Sleepy Joe Biden had to say on Monday.
If you’ve read “The Maxims of Wall Street” by Mark Skousen, you might be familiar with this quote:
“Invest at the point of maximum pessimism.” – John Templeton
While financial pundits might want you scared and helpless, NOW is an ideal time for investors to take action.
We’ve asked our team of experts to share their best strategies and ideas. And they did not disappoint.
Depending on your risk tolerance level, several options are on the table for you to consider.
If you’re conservative, then you want to focus on best-of-breed stocks.
What does that look like?
- Nearly $4 trillion in assets
- three-year annual earnings per share growth of 16%
- A price-to-earnings (P/E) ratio of 10.9x
- An all-star management team
We’re referring to JPMorgan Chase & Co (JPM) if you haven’t guessed by now.
Subscribers of the Fast Money Alert, co-authored by Skousen and Jim Woods, were alerted about the play on Monday. They shared their game plan on playing the stock and an options trade idea for investors feeling spicy.
If you’re not a Fast Money Alert subscriber and want to sign up, click here for more details.
#2 Quality At A Bargain
On Monday morning Schwab (SCHW) reported its monthly activity highlights for February. Despite the near-term cash sorting headwind, it showed ongoing gains in its core business. Its net new asset growth continued at a steady pace of $41.7 billion in February vs. $36.1 billion in January.
The firm indicated it expects cash sorting to continue near-term. Schwab thinks the cash sorting dynamic will drag near-term earnings but should abate during the back half of 2023.
Mark Skousen has his retirement funds at Schwab. He had the pleasure of meeting Charles Schwab in 2019 and had this to say about the company to his Skousen’s Home Run Trader subscribers:
“Yet in a panic, traders sell first and ask questions later. That can be a big mistake. And I think traders are making one here. Schwab is down 25 points — or nearly a third of its value — from where it traded last Wednesday. That makes no sense. And I urge you to take advantage of this folly. I see a major rebound coming — and those who step up during the chaos will do very well.”
Home Run Trader subscribers were given two ways to play the bounce on Monday, either with stock or options and a full trading plan to go with it.
Schwab rallied by nearly 10% on Tuesday. If you want Mark’s timely alerts, click here to get started with Home Run Trader.
#3 Follow The Smart Money
Over the last week, we’ve seen an influx in insider activity. And if there’s anyone who knows these banks better than anyone, it’s the executives working at these firms.
Below you’ll find which insiders made moves and the date they filed. The filing date is not the actual date they bought stock, but we do know the price at which they bought stock.
- Cullen/Frost Bankers, Inc (CFR): On March 13, the CEO bought 9.5K shares at $106.59 and a Director bought 5K shares at $108.09.
- Pacwest Bancorp(PACW): On March 13, the president and CEO of the community banking group bought 6.66k shares at $15.74. An executive vice president bought 3.15k shares at $15.25. An executive chairman bought 13.88k shares at $21.12. The president and CEO of the company bought 22.8k shares at $22.20.
- Metropolitan Bank (MCB): On March 13, the president and CEO of the company bought 20.52k shares at $24.20.
- Customers Bancorp (CUBI): On March 14, the president and CEO bought 5.2k shares at $20.50. The executive chairman bought 45.45k shares at $11.00, according to the March 13 Securities and Exchange Commission (SEC) filing.
- Schwab (SCHW): The CEO bought 50,000 shares at the open on Tuesday, March 14, according to Bloomberg.
If that’s not a vote of confidence, we don’t know what is.
While the Biden-led media was trying to strike fear into the American people, the executives of these companies were putting their money where their mouth is and buying stock.
It is an undeniable fact that the COVID-19 pandemic has shined a harsh light on the discord between reliable information and exploitative corporate journalism.
Joe Biden and the media attempted to manipulate public opinion but failed, thanks to diligent research from reliable, independent sources.
Embrace independent research because while fear-mongering was in full swing, people like Jim Woods, Bob Carlson, Bryan Perry, and Mark Skousen saw opportunity below the surface.