Remember those ads in which WaMu was bragging about how many years in a row its stock had outperformed the S&P 500? You don’t see those ads anymore.
WaMu’s (WM) stock is down another 10% today, and down more than 80% off its high. In fact, the stock is now trading at a level it last saw in 1992. So much for “value creation.”
Will WaMu just finish the job and go to zero? Based on the stock’s behaviour over the past two weeks, this seems a distinct possibility.
Remember that, with these potential-run-on-the-bank scenarios, it’s not what the balance sheet looked like last quarter that matters: It’s what it looks like right now. (Bear Stearns went from comfortably solvent to bankrupt in a matter of days). What WaMu’s balance sheet looks like now depends entirely on how many WaMu customers have demanded their money in recent weeks…and only WaMu knows that.
In any case, only $6 billion of market cap to go.
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