Interesting article out today gives an opinion on the recent...

Interesting article out today gives an opinion on the recent BofA accumulation. FYI.

'Bank of America Responds To Increasing Uncertainty'

"Although we see rising M&A activities in the recent year, banks are still highly affected by a cyclical downturn and the euro zone debt crisis. As a result, falling revenue in the banking industry remains an issue. This forces banks to cut jobs. In addition, increasing government regulations over the most profitable businesses such as proprietary trading and over-the-counter derivatives has caused investment banks to cut more jobs especially in the credit related businesses. ??

In response, Bank of America (BAC) is changing its strategy by switching its investment from profitable financial stocks in China to agriculture and mining stocks in Australia. ? ?BAC has recently acquired about 9.38% stake in Elders Limited, 7.77% in Adamus Resources Limited, 5.77% in Red 5 Limited and 9% in Resolute Mining Limited (RMGGF.PK).??

Elders Limited, an Australia-based company, is engaged in rural services, forestry, automotive components and investment. Elders Limited has a negative return with ROA of -2.38, ROI of -3.74, and ROE of -5.28 compared to positive return in its sector and industry.?

Adamus Resources Limited is a mine construction and mineral exploration company in Australia. Adamus has a negative return with ROA of -45.66, ROI of -58.01 and ROE of -321.02. ??

Red 5 Limited is a mineral exploration and evaluation company in Australia. Red 5 Limited has a negative return with ROA of -6.9, ROI of -7.17, and ROE of -7.14 compared to positive return in its sector and industry.

Resolute Mining Limited is a gold mining and minerals prospecting and exploration company in Australia. Resolute Mining Limited has a positive return with ROA of 7.21, ROI of 9.02 and ROE of 17.35. ??

BAC's recent acquisitions are not without a strong reason. Knowing the uncertainty in global economy, BAC wants to switch to mining to hedge against inflation and economic downturns.

We can see that the four companies above are companies based in Australia. BAC did not choose to invest in mining stocks in Europe, America or Asia. We believe Australia has a strategic position as one continent with rich mining resources. We expect the Australian Government to have a greater flexibility to manage its economy compared to larger continents. ??

Bank of America Corporation’s Merrill Lynch, Citigroup (C) and Royal Bank of Scotland Group plc (RBS) might get a lawsuit from Woori Bank after $1.4 billion in losses on its derivatives investments.??

Following BAC's moves, investors might want to consider pairing BAC with mining stocks to protect their assets against economic downturn. For example, Resolute Mining Limited (RMGGF.PK)."

http://seekingalpha.com/article/310057-bank-of-america-responds-to-increasing-uncertainty