New York, New York (PressExposure) April 25, 2012 -- George Leong, contributor to Profit Confidential, believes that banks are the fuel driving the economic growth, a reason why he is positive on the bank stocks. As the economic recovery continues, the key benefactors will be the big and regional bank stocks, according to Leong.
"From growing businesses, real estate activity, and consumer credit, the reality is that the nation's banks have steadily charted a recovery since the collapse of Lehman Brothers in late 2008," says Leong. "This chaotic event in bank stocks was an opportunity that only appears once in a while."
In the recent Profit Confidential article, Bank Stocks: A Play on the Economy, Leong outlines his theory on bank stocks.
"It was clear in my mind that the U.S. government could not afford to let the major banks fail, as it would have likely triggered a mass selloff in the U.S.," says Leong. "There was absolutely no way the government would allow the Bank of America Corporation or Citigroup Inc. to fail."
Leong points to the KBW Bank Index, which shows the steady upward move in the index; up over 43% since October 2011.
"Money was made and I feel there will be more gains coming," says Leong. "But I do remain concerned with some of the bad stuff on the balance sheets and the government's new restrictions on banking activities as set by the Volcker Rule to restrict some speculative activities."
Leong favors the big bank stocks over the smaller regional banks, which are tied to the health of a specific region of the country instead of the entire country.
"I view pullbacks as an opportunity to accumulate bank stocks, because I remain longer-term positive on the big banks to drive higher as the economy recovers and expands," says Leong.
Profit Confidential, which has been published for over a decade now, has been widely recognized as predicting five major economic events over the past 10 years. In 2002, Profit Confidential started advising its readers to buy gold-related investments when gold traded under $300 an ounce. In 2006, it "begged" its readers to get out of the housing market...before it plunged.
Profit Confidential was among the first (back in late 2006) to predict that the U.S. economy would be in a recession by late 2007. The daily e-letter correctly predicted the crash in the stock market of 2008 and early 2009. And Profit Confidential turned bullish on stocks in March of 2009 and rode the bear market rally from a Dow Jones Industrial Average of 6,440 on March 9, 2009, to 12,876 on May 2, 2011, a gain of 99%.
To see the full article and to learn more about Profit Confidential, visit www.profitconfidential.com.
Profit Confidential is Lombardi Publishing Corporation's free daily investment e-letter. Written by financial gurus with over 100 years of combined investing experience, Profit Confidential analyzes and comments on the actions of the stock market, precious metals, interest rates, real estate, and the economy. Lombardi Publishing Corporation, founded in 1986, now with over one million customers in 141 countries, is one of the largest consumer information publishers in the world. For more on Lombardi, and to get the popular Profit Confidential e-letter sent to you daily, visit www.profitconfidential.com.
Michael Lombardi, MBA, the lead Profit Confidential editorial contributor, has just released his most recent update of Critical Warning Number Six, a breakthrough video with Lombardi's current predictions for the U.S. economy, stock market, U.S. dollar, euro, interest rates and inflation. To see the video, visit http://www.profitconfidential.com/critical-warning-number-six.