Wachovia did even better by performing worse. After posting an $8.9 billion loss, its stock soared 27 percent.
It’s not because red ink is the new black on Wall Street. It’s just that these companies and others “beat expectations.”
I’m glad to see the banking stocks up. But I hope this new-found optimism doesn’t refocus attention on stock prices rather than the underlying value of these companies.
There’s never been a better opportunity for a financial services firm to start building a story about long-term responsibility rather than quarterly results. Now that would really be a way to beat expectations—and earn my trust.
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