Interest rates seem stuck in the muck. They may not rise fast enough to generate profits.
High unemployment rates will constrain borrowers from increasing debt and constrain the growth of deposits. Both items are critical ingredients for banking success.
Great regulatory oversight prevents nimbleness in moving in and out of opportunities and product lines.
As interest rates rise underwriting banks will find it harder to place new business.
The index is very susceptible to headline risk. One bad story and everyone hurts a little. In an index fund that’s not good.
George Gutowski writes from a caveat emptor perspective.