It seems the financial crisis has been more like a banking crisis these days, with the RBS virtually nationalized by the British goverment, and Citi and Bank of America increasingly can not stand on its own. The No. 1 and No. 2 US banks according to market cap, J.P.Morgan (NYSE: JPM) and Wells Fargo (NYSE: WFC), are also under pressure today, both hovering around $20 and $15, respectively.
Of course this all happens today as the new US president sworn into office. It appears to me the market does not like the stimulus package proposed by Obama team, or the uncertainty around it? Plus the controversy around his treasury secratery pick. All this bring uncertainty to the market, and we know the market does not like uncertainty.
What will we go from here? Will all the big US banks taken over by the federal goverment? It seems unlikely because this country lives or dies on the private business or entreprenuership. With goverment controlling large banks, it will be like (dare I say) China.