The stock market surged out of the gate this morning as investors celebrated the further dilution of Bank of America. The Bank of America share offering also confirmed that Ken Lewis is the world’s worst liar for claiming to be “well capitalize” and in no need of further capital raises. Clearly, having a CEO who can lie his *ss off is a huge positive for stocks. The stock finished the day with a 4.4% gain, but the money flows tell a very different story. While short sellers were in a full blown panic to buy back shares at higher prices the sellers were heavy. VERY HEAVY. BAC made up 17% of all volume on the NYSE today and the up tick: down tick ratio was 1:2.7 – an unusually high ratio for a stock that closed up so much.
While the price action on the surface of the bank shares might appear positive the money flows tell a very different story….