Adding to Bank of America warrants positon
True to my word (see Gerard’s question on my earlier post), I have increased my position in Bank of America A warrants by about 50% at around the $5.50 level. I may increase my position still further if the warrant price falls to $5 or below. My outlook for the money center banks hasn’t changed, even if Mr. Market has become less enthusiastic. Interest rates are still low and the banks are cranking out money on their lending spread. The mortgage issue hasn’t gone away; I think it will take years to work out, but I do think it will be worked out in the end without too much pain. In the meantime, I don’t see BAC being allowed to fail, although that, too, could happen. I would be much more leery of holding an interest in BAC if it were a European bank with a large exposure to Greek bonds.