Let’s Talk… the Banking Crisis!!

So I’m getting calls from people wanting to know if they should buy the stock of a bank they see and may use everyday that is down 75% from its high. Financials are having major issues after SVB and Signature Bank went under over the last two weeks. Here are my thoughts. 

First, consider taking a pause. Let the dust settle, then reevaluate the situation. We watched two banks get zeroed out really quickly. I’ve been doing this professionally for almost 24 years. Let’s just say Enron and WorldCom didn’t go from 90 to zero overnight. 

Second, consider an ETF that buys a big basket of financials or a regional bank ETF. I’d stay away from a single stock risk. 

Third, if you do buy a single stock, don’t buy it in an IRA and don’t invest more than you can lose. Keep in mind, if you buy in a regular account, you can take a $3k loss on your taxes. 

Lastly, just because a stock was at $300 doesn’t mean it will go back to that level. If it’s down big, there is probably a reason!

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