As you know I like participating discussion on yahoo stock message board. I usually post on the stocks I traded on and use screen name StockTradersBlog. Yesterday I wrote a post “Bank of America Earning Forecast and Financial Statement Analysis”. I have to remind you that I am a blogger and a stock day trader with lousy trading returns. So my analysis by no means has any investing grade quality.
I originally believe BAC will report very good earning in the second quarter. But Citi Group said that BAC would report loss and lowered its target price. I was basically trying my best to do my own earning analysis to see whether Citi Group’s opinion was going to be right. I put the link on BAC board in hope to test my analysis. I hope to see some counter arguments. But very disappointed I didn’t see any and I was called spamming by some assumably traders that are long on BAC shares.
Nowadays investment firms upgrade and downgrade stocks without any quantitative analysis showing to public to support their opinion. It is no different then telling you this stock should go up and you should buy or that stock should go down and you should sell. I personally believe this kind of practice is obscene. The only thing this kind of practice can achieve is stock price manipulation. I think it is better to be written into law that when investment firms upgrade or downgrade stocks they have to support that with numbers (quantitative analysis) and they have to give the source of the numbers and other information they use to support their arguments.
That is called fair and that way investor can make truly informed decision based on how they see the facts instead of blindly following investment firms’ opinion. But I guess putting that in regulation is a nightmare for investment firms because that will make them lose earning power. Their earning power to a large extend is deprived from their abilities to influence stock price using one sentence and I think this is not right.
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