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Markets are rallying today, with the Nasdaq-100 even spiking up into bull market territory. But I wouldn't get too excited. Bottom line, the quagmire with the banking system is far from over. A ton of banks are sitting on marked-to-market securities losses amounting over $620 billion, according to an analysis from Goldman Sachs.
But that's just the tip of the iceberg. In last week's Total Wealth column, I wrote about the staggering amount of money that regional banks have tied up in loans, many of which are in the commercial real estate sector. Go back and check out that piece if you haven't already - while banks have gotten away for a while with not having to record the devaluation of those loans, that's about to change, and when it does, we could see a whole new round of depositor flight.
The Fed wants you to believe it has this problem handled with a combination of discount window lending, the new Bank Term Funding Program, and advances available through Federal Home Loan Banks. But there's a downside to all that - as usual, when you look at the fine print, banks that are over-reliant on these methods are basically just kicking the can down the road rather than solving the problem.
I'll be diving deeper into these issues in tomorrow's Total Wealth article - keep an eye out for that.
In the meantime, the spotlight on commercial real estate and its role in regional banks' insolvency has created some turmoil in the sector, which makes it one of the best places right now to go hunting for opportunities. You have to be very careful here - a lot of the household names you're familiar with are toxic traps right now and will drop your portfolio like deadweight.
But don't worry - I've got the scoop on which of those losers to avoid and which will give you the best bang for your buck, especially if the rally continues.
You can get all the tickers here just by watching the video below.
As I said, keep an eye out for tomorrow's article, and we'll see you next week.
The post The Best Real Estate Stocks to Buy and Sell Right Now appeared first on Total Wealth.
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.
The work he did laid the foundation for what would later become the 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 Hyperdrive Portfolio, Shah presents his legion of subscribers with massive profit opportunities that result from paradigm shifts in the way we work, play, and live.
Shah is a frequent guest on CNBC, Forbes, and MarketWatch, and you can catch him every week on Fox Business's Varney & Co.
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