A Fifth Third Half of Year Recovery?

Q: Who is looking for a fifth third half of year recovery?

A: Fifth Third Bancorp shareholders, that's who! Badum-ching!

Fifth Third Bancorp (FITB)

Fifth Third Bancorp. operates as a diversified financial services holding company.

Here's a long-term chart of what financial services diversification can get you.

I know this sounds crazy, but ever since yesterday on the road, I've been seeing this shape. Shaving cream, pillows. Dammit! I know this. I know what this is! This means something. This is important. - Roy Neary, Close Encounters of the Third Kind, 1977

It never gets old. Sorry!

You think I investigate every Walter Cronkite story there is? Huh? If this is just nerve gas, how come I know everything in such detail? I've never been here before. How come I know so much? What the hell is going on around here? Who the hell are you people? - Roy Neary, Close Encounters of the Third Kind, 1977

Why did I have to sign the loan documents in blood? Why did I have to promise a first born? Why am I in this hand basket? Where am I headed? Why is it getting so hot?

Science illusion and ignoring the lessons of history

The first is that even at this late stage, we should never underestimate the ability of the banks to come up with novel ways of losing money.

The real beauty of too big to fail is that failure simply isn't an option. Oh the risks I would take if that worked for my own personal finances. Heck, I might even try buying stocks again at some point. Who knows!

This is not intended as another of those doom-laden comparisons with the Great Depression. The point is rather that as this crisis unfolds, some of our previous optimism seems the product of complacency or lack of understanding. We already knew what went wrong before. What we are now learning – the hard way – is why.

Doom-laden comparisons with the Great Depression must be thought of as a bonus. That's how I think of them anyway.

Alternatively, in China – whose leading banks are now much the world’s largest by market value – government has used its majority control to keep the banks lending. That is one reason why, according to the latest Merrill Lynch fund manager survey, investors now base their hopes for global recovery once more on the Chinese locomotive.

Given the recent collapse in China’s trade figures, that may be a long shot. It rather sounds as if the old decoupling theory is making a comeback out of sheer desperation.

Welcome to the Great Desperation.