Of Going Green and Bank of America
Muhammad is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
How green is green? For Bank of America (NYSE: BAC), green is boundless - completely limitless! There is no telling as to what extent the financial heavyweight will push for environmental friendliness and sustainability.
A little recap will tap your attention. Back in 2007, Bank of America launched a $20 billion environmental initiative. This initiative was received cordially and to the joy of stakeholders exhibited accelerated progression.
Flash-forward: Its 2012 and the 2007 initiative which was designed to take a decade is on the brink of completion. Despite 4 years left on the clock, the curtains are about to close. The anticipation is simply amazing and Bank of America knows it. This is perhaps the fueling factor behind yet another environmental friendly initiative. The new initiative will pool an incredible $50 billion which will be expended over the next ten years.
The primary goals of the $50 billion initiative principally revolve around cushioning climatic change, extending lower carbon economical resolutions and suppressing demand on natural resources. Brian Moynihan, the CEO at Bank of America, exclaimed that the new initiative was, albeit ambitious, achievable. He noted that the prior goal was completed in about half the time initially allocated.
The road may be bumpy, but one thing remains clear- a bullish stretch. Wait a moment, isn’t this far fetched? You cannot come to a conclusive standpoint by keying in one factor, can you? Well, sometimes rules are broken - particularly so in the case.
Going green is a sure way. The global community is coming to the realization that energy efficiency is paramount. Natural resources are getting more and more valuable by the day. In simple terms, depletion is at work. This has sparked off a gradual yet evident transformation. The alternative energy industry is swelling by the day and in the near future might gain unprecedented prominence.
With Bank of America bolstering operations in this niche, there is a growing possibility that it may benefit from the collective growth of the alternative energy niche. The possibility also happens to lean towards the fact that it may emerge as a leader in the industry. This is particularly so because of its reputable track record.
One known thing about speculation is that you can never be too sure. After all, the fundamental principle of speculation is drawing conclusion from incomplete evidence. The line that creates the disparity between almost accurate speculation and downright far fetched speculation is the weight of evidence. The fact that I have prioritized the green initiative shows that it is a more sure way of deriving accurate foresights. If I wanted, I could have used the day to day operations and trends. Like for instance, Bank of America rose 2.4% at the wake of the Spanish bailout. I, however, know the danger that lurks when it comes to financial stocks and speculations. You must use hard evidence to support your speculation. Tables do turn. Just ask JPMorgan (NYSE: JPM). The market was bullish at the eve of the $2billion loss and most financial blogs were painted with bullish remarks of how the prior trading was a sign of a bright future in the horizon. As we all know, nothing like that ever happened.
In actual fact, JPMorgan is still stuck up in the mud. It has yet received another blow in the form of a $44 million class action civil lawsuit (which by the way it agreed to pay).
Short term vs. long term
In the short term, I am neither surefooted in growth nor income. Although, the S&P 500 has recorded a somewhat positive trend in the past few days, the macroeconomic view is still dim. From a prose outlook it is evident that everyone is stuck up in denial. I am even concerned that we might be stepping into a recession. I am afraid that Bank of America won’t be too strong to fight the waves. Nonetheless, it is geared up for a bright future in the long haul - its new environmental initiative says it all.
As it is, the negative implications from Europe seem to have clouded the U.S markets. The near future is uncertain and obscure. The long term, however, promises much prosperity- especially so for Bank of America. By enhancing its green outlook to business, it has consolidated a solid platform to stage future success.
muhammadbazil has no positions in the stocks mentioned above. The Motley Fool owns shares of Bank of America and JPMorgan Chase & Co. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.If you have questions about this post or the Fool’s blog network, click here for information.