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The big banks are all reporting their fourth-quarter earnings this week.
Make no mistake: Although it's only January, this will be one of the most significant events of the year…
You see, in the big picture, how the banks fare and what their future prospects are could single-handily determine the trajectory and breadth of the recovery we've been hoping for.
Even more, their "financials" could have major implications for your money.
Depending on what happens, it may be time to take profits if you own their stocks. It may even be a good time to selectively short the financials – and make a killing doing so.
Today, I'm going to share with you how I think the whole thing will play out.
Then, I'm going to give you a special bonus:
An opportunity to make a nifty profit off of the big bank earnings reports – including one of the fattest dividend payments you'll see in your lifetime…
Big Bank Earnings: What's in Store?
Almost all of Wall Street's big banks – JPMorgan Chase & Co. (NYSE: JPM), Wells Fargo & Co. (NYSE: WFC), Bank of America Corp. (NYSE: BAC), and Citigroup Inc. (NYSE: C) – are trading at or very close to their post-crisis highs, with Goldman Sachs Group Inc. (NYSE: GS) being the only exception.
The "financials" have been front and center this whole rally.
The question now is, will their earnings – most of them have been posting record or near-record numbers – continue to grow, or will the Volcker Rule and approaching Basel rules and the new QM (qualified mortgage) rules dampen their earnings power?
As I said, when it comes to the economy, a lot rides on America's banks. Far too much, in my opinion. These guys haven't lost a beat since the financial crisis. They're still here, and bigger and more frightening than ever. It's sickening, but it is what it is.
You know exactly what I'm talking about…
About the Author
Shah Gilani boasts a financial pedigree unlike any other. He ran his first hedge fund in 1982 from his seat on the floor of the Chicago Board of Options Exchange. When options on the Standard & Poor's 100 began trading on March 11, 1983, Shah worked in "the pit" as a market maker.
He helped develop what has become known as the Volatility Index (VIX) - to this day one of the most widely used indicators worldwide. After leaving Chicago to run the futures and options division of the British banking giant Lloyd's TSB, Shah moved up to Roosevelt & Cross Inc., an old-line New York boutique firm. There he originated and ran a packaged fixed-income trading desk, and established that company's "listed" and OTC trading desks.
Shah founded a second hedge fund in 1999, which he ran until 2003.
Shah's vast network of contacts includes the biggest players on Wall Street and in international finance. These contacts give him the real story - when others only get what the investment banks want them to see.
Today, as editor of 10X Trader, Shah presents his legion of subscribers with the chance to earn ten times their money on trade after trade.
Shah is also the proud founding editor of The Money Zone, where after eight years of development and 11 years of backtesting he has found the edge over stocks, giving his members the opportunity to rake in potential double, triple, or even quadruple-digit profits weekly with just a few quick steps.
Shah is a frequent guest on CNBC, Forbes, and Marketwatch, and you can catch him every week on Fox Business's "Varney & Co."
He also writes our most talked-about publication, Wall Street Insights & Indictments, where he reveals how Wall Street's high-stakes game is really played.