A TIMELY REMINDER: WHY DO WE BUY STOCKS?

Earnings.

Equity (stock) holder is the bottom of the capital structure. He only cares about one thing and one thing only: PROFIT.

So he doesn't buy a company just because it has narrowly avoided bankruptcy. He buys the earnings projection of the enterprise and thinks it's a worthwhile avenue to spend his time and money.

Example: Don't buy Goldman Sachs because you think it won't go bust. Goldman won't go bust. But we are going back to the 1990's in terms of leverage. Therefore it's gonna be that boring business again, lending at 7% while borrowing at 5%, with modest leverage.

Therefore, after cutting out the M&A and mortgage/securitization business sizeably, if you happen to get $10 earnings forecast growing at money supply inflation, then you can expect 10x Earnings multiple to arrive at $100 stock price.

No I am not kidding.