Vince Farrell Financial Quotations

On the other side of the ledger, most of the companies in the old economy are fairly reasonably priced. So, a couple of weeks ago we started to see a shift. First, the energy stocks did somewhat better. Then, the pharmaceutical stocks had quite a run. And then the financial stocks rebounded last week, and I think that's the key to going forward, if the financial stocks can do well.

I think there is an era of optimism that pervades the financial community in the United States. There's just this feeling that stocks are going to go up, and up, and up.

Financial stocks tend to do well when interest rates are being lowered. Interest rate moves by the Fed take about 12 months before they work their way through the economy.

AIG trades at a market multiple, and it is indeed the best insurance company in the world, in my opinion. But financial stocks rarely, if ever, trade at market multiples.

I like financial stocks, but not banks, ... As a rule you have to be very cautious, because if the economy is softening, you don't know the extent of the loan loss reserves they're going to have to ante up for loans that go bad in a soft economy.