It sounds like a war, doesn't it? It's the corporate type that will most likely end up in court somewhere. Citigroup (C) offered to pay $2.1 billion for Wachovia's (WB) banking operations just 4 days ago. What I don't understand is how Wells Fargo (WFC) could go behind Citigroup's back and do a deal, just like that. A copy of the exclusive agreement between WB and C can be found here.

The financial press is beating its "depression" drums just a bit harder this afternoon in the wake of Congress' surprise rejection of its bailout legislation and the market's strong drop. However, we remain skeptical that this behemoth bill would indeed be the market's short term salvation.

The breakout of the symmetrical triangle failed and prices moved to the downside. Important support at $16.5 and positive divergence on the 60 minute chart. Risky trade.

Your humble editor is skeptical that this latest financial rally will turn out to be anything of substance… except another shorting opportunity when the time is right.

Bottom line: The current rout in financial sector shares might smell awful to the simple onlooker. But smart investors should know that it smells like the beginning of the end of their collapse, too.

Going against the conventional advice to avoid financials and Citi in particular and decided to purchase some Citigroup stock

Q4 07 Earnings from C and MER were expected to bomb so badly they could be best described as "Shock and Awe" earnings announements. Bearish Sentiment preceding these announcements were at an extreme not seen since the Oct 1990 war in Iraw that prompted a 20% correction in the stock market.

Merrill Lynch's Q4 08 negative earnings surprise was well known and anticipated by the street. This allowed them to hold their support around 49-50 this past week

Citigroup reported its earnings this morning and the stock is bouncing around like crazy. It was up about $0.50 right after the press release came out and then it tanked and went down as much as 3% to $28. It is now at $28.71.

Citigroup is expected to announce a sizable dividend cut, cash infusion of at least $10 billion and write-down of as much as $20 billion in mortgage-related investments as part of its fourth-quarter earnings report.

I thought I would share a report I found on Infectious Greed. These are the top ten stocks by dollars traded in 2007. It will be interesting to see how these compare in 2008. Will they still be heavily traded?

Symbol Company Rank Last Year Change
AAPL Apple Inc. 1 2 1