Goldman Sachs Giant Squid Bear Case Scenario $GS, $XLF, $MS, $SCHW, $MQBKY, $AMTD

Goldman Sachs the Wall Street Giant Squid is about to release earnings. Ponder this Bear Case Scenario if you can:

Regulators are driving lower leverage. Lower leverage reduces margins, spreads and profits. Low leverage means low return for Goldman Sachs.

Interest rates are to rise soon. Bond portfolios will shrink accordingly. Clients will be suspicious of Goldman advice on Bonds.

Goldman will probably load up on reverse market bets and win big as interest rates rise.

Too big to fail yes. But not too big to bleed badly in a downturn which we know will come someday.

George Gutowski writes from a caveat emptor perspective.

AMD Bear Case or Death Case Scenario $AMD, $TSM, $TXN, $ARMH

AMD is about to release earnings. Ponder this Bear Case Scenario. or is it the Death Case Scenario. Read on:

Bulldozer and Piledriver server processors and Fusion PC processors have not been as successful in the marketplace as we had previously anticipated.

Intel remains the dominant player in the processor market and holds long-term advantages over AMD. Intel is struggling so what chance does AMD have?

Manufacturing problems can limit availability and marginalize AMD as a viable supplier.

George Gutowski writes from a caveat emptor perspective.

ASML Holdings Bear Case Scenario Impacting Share Price $ASML, $KLAC, $LRCX, $TOELY, $AMAT

ASML Holdings will release earnings shortly. Ponder this Bear Case Scenario

ASML depends on the deeply cyclical semiconductor industry for demand. Essentially they are hostage.

ASML depends on a handful of powerful customers and will sell only several hundred systems each year.

Dependence on a limited number of suppliers for key components exposes ASML to pricing power and possible disruptions to its supply chain.

This firm is beholden to others for its raison d’etre. Not a good way to take on risk.

George Gutowski writes from a caveat emptor perspective.

US Bancorp Is There a Bear Case Scenario $USB, $PNC, $BBT, $STI, $FITF, $CMA, $KRE, $KRS, $KBWB, $KBUR

US Bancorp is about to release earnings. Ponder this Bear Case Scenario if your belief in USB might waiver.

Regulators limit dividends to 30% of earnings no exceptions. The company does not have the ability to trick yield oriented investors.

As long as interest rates stay low margins will be small and difficult to expand.

Additional regulatory burdens may be on their way as Obama seeks to beat up Wall Street.

In the next crisis will USB be asked to fix something in the marketplace that they will regret shortly thereafter.

George Gutowski writes from a caveat emptor perspective.

PNC Bear Case Scenario for this financial? $USB, $PNC, $BBT, $STI, $FITF, $CMA, $KRE, $KRS, $KBWB, $KBUR

PNC Financial releases earnings soon. Ponder this Bear Case Scenario as you consider your stake:

As loan portfolio is expanded underwriting standards may be relaxed with the eventual loan losses working their way through the system to a balance sheet near you.

New banking regulations will impact PNC’s efforts to control its expenses.

The benefits of purchase accounting accretion from PNC’s discounted acquisition of RBC Bank USA affect net interest margin.

In summary PNC has some interesting factors which can easily crumble and turn into problems.

George Gutowski writes from a caveat emptor perspective.

Kansas City Southern Bear Case Scenario $KSU, $UNP, $CSX, $NSC, $CNI

Kansas City Southern is about to release earnings. Ponder these Bear Case Scenario’s:

Railways need to spend copious amounts of capital on maintaining and upgrading road beds. If this gets away from them you have costly derailment with unhappy customers, screaming union labour, incredibly bad publicity and flinty eyed regulators looking up your you know what.

Kansas City leases much of its rights of way. Leases end and are expensive to impossible to renew if the line is profitable.

Kansas City is exposed to both Mexico and Panama. The political dynamics are always suspicious and problematic.

George Gutowski writes from a caveat emptor perspective.

Bank of America Possible Black Swan Scenarios $BAC, $C, $JPM, $XLF, $WFC, $HSBC, $TD

Bank of America is about to release earnings. Ponder these Black Swan Scenarios:

Bank of America managed to survive the stress test for now. This bank is still a wounded puppy. 2008 legacy issues either manufactured in-house or acquired still abound. A massive cost cutting exercise is underway, but cost cutting on its own is rarely successful. Regulators have not finished looking at this one just yet and may create new surprises in the future.

Most banks do well in a rising interest rate environment. But how many of their cross sold customers can handle a 35 increase in mortgage carry and still make payments on time.

Cost of capital is years away from being covered.

George Gutowski writes from a caveat emptor perspective.