Bank of America Chief Executive Officer Kenneth Lewis just forecast an absurd, totally unbelievable profit of $50 billion for this year on revenue of over $100 billion, a 50 percent profit margin. No legitimate bank in history ever had a 50 percent profit margin!
Under Chief Executive Officer Kenneth Lewis, Bank America took $163 billion from the federal rescue program, and was widely expected to be taken over and totally nationalized because of bad assets. “Bad Assets” means that management had no idea what it was doing with shareholders’ and depositors’ money; i.e., bad management, failed management, management that should be replaced, invested in more than $163 billion of worthless assets, the losses on which had to be covered by the taxpayers..
CEO Ken Lewis also bought Merrill Lynch and failed to foresee that Merrill had tens of billions MORE of bad assets than it told Bank America about during negotiations. Then a few months after being acquired by Ken Lewis’ Bank, Merrill suddenly discovered another billion or so of losses in its London office.
Ken Lewis appears to be guilty of, select one or more of the following:
1. Not having the foggiest idea of what is going on inside his bank;
2. Not knowing what the condition of Merrill Lynch was when he was dumb enough to buy Merrill, let alone overpaid for Merrill;
3. Defrauding the government out of $163 billion to save a troubled bank when it actually had the highest profit margin in the history of all banks anywhere in the world, anytime;
4. Lewis presided over a gigantic phoney, criminal write down of assets last year, and then reversed the write down this year to save his job by falsely claiming his grand intelligent management saved the bank;
5. Bank America is run by escapees from the lunatic asylum, or by Barney Frank, or by Chris Dodd, and has no connection to reality whatsoever, just like Obama’s stimulus plan, and just makes up numbers for press releases depending on how much coffee the good ol’ boys drank that morning;
6. No one in finance or the government has any idea what the truth is about any big bank, so it is acceptable for a bank to say it needs $163 billion of taxpayer money, and the 90 days later accidentally notices that it made $50 billion profit;
7. In an industry that normally has a 3 to 5 percent profit margin, incompetent management can make a 50 percent profit margin, and nobody smells a “Madoff?”
With events like this continuuing, it is insane to believe any reported financials, which means there is no way to decide which stocks to buy or sell. In the land of the blind, the one eyed person is king. This one eyed person sees nothing but piles of deaf, dumb and blind retards pretending to be corporate boards of directors, and will not own any stock or bond for a long time.
Ruth Goldman Talks 