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Would it be a good idea to buy Washington Mutual stock?
Robos A Go Go
Registered User regular
Registered User regular
So AIG was like $1.80, received a bailout, and jumped to $5.00 before settling at like $4.
Would the same thing happen to Washington Mutual if it received a bailout? If so, what's the likelihood that it will receive part of the $700 billion bailout plan?
And if that likelihood is high, would it be a good idea to buy some stock in Washington Mutual now, when it's at $2.00 a share?
Would the same thing happen to Washington Mutual if it received a bailout? If so, what's the likelihood that it will receive part of the $700 billion bailout plan?
And if that likelihood is high, would it be a good idea to buy some stock in Washington Mutual now, when it's at $2.00 a share?
Robos A Go Go on
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I don't know. I mean, if everything that receives a bailout is bound to tank, then why give a bailout in the first place?
Err, yeah, and I'm asking if WaMu's value might increase?
https://twitter.com/Hooraydiation
Yes, and it might decrease. There is no good answer to your question.
As far as which is more likely (which is probably what you're really asking), I don't know. I lean more towards "you might make a quick buck" but some things tell me there's a good chance of that not happening.
Also keep in mind that this bailout may not happen at all. It's losing a lot of steam already, and if nothing else it probably won't happen in the form originally proposed by Paulson. Even if it does happen, WaMu may not get any of that money.
If you have money to blow and expect the bailout to go through, buying WaMu is fine.
It might make more sense to invest that money in better places.
I would only invest exactly what you can afford to lose in something like this. As in, if you took the money you were going to put into WaMu and burned it, would you be okay or go nuts?
If you decide to do this, know you're taking a large gamble with your money.
Roulette might be a safer option, "even" wins almost half the time I hear.
I would say it's a very bad investment too. Thought I said that the first time.
Yeah, sorry for painting the thread with THAT broad of a brush, you and grungebox actually provided pretty helpful input, but everybody else seemed to be summarizing what a stock is.
I would definitely look towards a sector that's starting to gain a foothold and looking to expand too. For example, a few months back it would've been really smart to invest in companies that are offering "Green Solutions." Look for something that could address a huge public need and invest.
Not to offer more generic investment advice, but some people don't know this and just pick stocks at random.
It costs you, what, 5-10 bucks to initiate a trade? Costs you usually $0 to open a CD and get a guaranteed 3-4% interest rate.
I was going to suggest a CD once I found the % interest on it.
It would be a very risky idea to buy WaMu stock.
Shogun Streams Vidya
Or just give me your spare cash and invest in my happiness.
Just remember, never invest more than you're willing to lose.
The people who make money from day trading aren't traders, they're stock brokers.
This is not exactly true. Goldman Sachs is currently auctioning WaMu and there are several prospective buyers, however they are probably not willing to buy unless the government purchases WaMu's toxic assets because WaMu really loved their commercial real estate, MBS, and CDO instruments. However these buyers are biding their time to see if the government purchases these assets making WaMu much more lucrative. The chance of WaMu being bought out is greater than WaMu folding unless the bailout does not go forward in a reasonable amount of time.
edit: Also when the stock price is at $2 a 25% increase/decrease is not very significant unless the OP has serious money at stake.
Shogun Streams Vidya
Why invest in something that has the possibility of going down?
Ask yourself these questions.
1) Do you see WaMu being in existence 10 years from now?
2) Do you see WaMu being in existence 20 years from now?
3) Is the stock selling at a reasonable price for decent returns?
4) Do you understand its business model and where the money is going? Look at their annual reports?
5) Is the company managed by competent and good people. Management is key. Look at Warren Buffet - swell guy.
If you can't answer these questions honestly, you shouldn't be investing.
It's also retarded because short term investing is stupid and after looking at WaMu's annual report, it doesn't look like things will be all that great.
I'd only invest in them as a game. Not as a serious way of making money, then again, if you're playing stocks to make money instead of playing the game...then you probably have bigger issues and risk.
The game comes first. Money is secondary to playing, but obviously not everyone subscribes to that.
Which is why it must hurt so bad when they get burned.
Oh look, NBC is explaining it right now. Turn on the TV. TLDR: investing in finance only right now isn't a great idea, and anyway it's already over. JP Morgan bought a lot of their assets and branches.
Hey, I own JP Morgan! Yay for me.
Anyway, what you are talking about doing is a gamble, but it's a gamble with better information than the odds of a ball falling on "black" or "red" so I would say buying 500 shares for 1K wouldn't be a bad idea, provided you wouldn't put yourself in any financial difficulty by doing so (IE, that money is disposable; it is money you wouldn't worry about taking to a casino)
I'm not sure why so many people think this is such a terrible idea, I know many people who have made tens of thousands of dollars with very small initial investments doing this.
The key: Knowing exactly what you are doing, and not getting greedy (that's where people always seem to go wrong)
Wait, so what happens to WaMu stock now that JP Morgan has bought their assets and branches?
Is it now worthless?
https://twitter.com/Hooraydiation
Anything of value has been bought. This is why you don't follow your "gut" when it comes to the stock market. Anything that's a deal will be immediately seen as a deal and snatched up -- it's explained in arbitrage theory, or that arbitrage doesn't exist in an open market because any opportunity to make profit by simply moving money around will be quickly seized upon and equalized.
Anyway, that settles that.
https://twitter.com/Hooraydiation
Since many companies are down right now it is a good time to buy. 10 years from now honda will still be honda. Just because they are taking a small dip right now doesn't mean they will stop earning. But do your homework or reap the reward of laziness.
As for WaMu specifically, you probably can't buy the stock now anyway. The fed seized it, and JP Morgan bought the assets from them. The accounts are supposed to be okay (I'm not holding my breath), but the news has specifically stated that WaMu stockholders have been wiped out.
As for owning JP Morgan Chase, first they buy out Bear Stearns, now WaMu. We'll have to hope that they don't wind up in the hold after this also. Yeah, they're supposed to have more money than God, but that's what they said about the other financial institutions also.
EDIT: Also, Donald Trump himself recommended last week on CNN that buying a house now is a good idea. With all the foreclosures going on, those houses pretty much sit as debt on the banks books and they're going to be pretty desperate to unload them. I've debated talking to my grandparents (who have a lot of money) about going into a business of buying up some houses, keeping them up and maintained, then reselling them.
Edit: Totaly missed page 2 in which this info was revealed already. Nuts.
See how many books I've read so far in 2010
That wasn't the case this morning when he originally asked about it.
Trust me, you don't need to worry about JPM. 8-)
Good. Woooooooooooooooot!
You know how many times Donald Trump has filed for bankruptcy in his career, right?
Historically speaking, the price of housing is 14 times the annual cost of renting. At the housing bubble's peak, in many markets that benchmark rose to more than 25 times the annual cost of renting (meaning that there wasn't much more financial incentive to buy rather than rent, except people like buying and hate renting). Housing prices *have* fallen, but they're still no where near the historical benchmark for what constitutes a reasonable sale price.
Moreover, all these banks like Washington Mutual that keep failing? It's largely because they played a little too fast and loose with their finances. They've since over-corrected and have significantly tightened up their lending standards--but what that means is that whereas two years ago you could get a home with no downpayment on a ridiculously lax mortgage even with mediocre credit, today you have to have nearly perfect credit AND be able to put down between 10-20% of a home's sale value as your downpayment--in many markets that still means being able to drop $100,000 (it does in my housing market). When banks strike a happy medium on lending standards and the market correction finishes, THEN would be a good time to buy a house.
Unless you already have $100,000 in liquid finances sitting around in your bank account.
In which case I kind of doubt you're asking for financial advice on the internet from a bunch of gamers.
In all eventuality, they're pretty neck and neck with costs, but one gives you equity to your name. Also not to mention the only way your payments go up is if your taxes go up, not so necessarily true with an apartment. One's tried to tack on $250 extra a month because the area was developing rapidly.
Sorry for the tangent, but now is definitely a good time to buy houses, it's a buyer's market. Foreclosed houses can be had for cheap.
1. Can you get a mortgage? Not knowing anything about your finances and treating you like a%
And like others have said, short term investing is such a waste.