If you have ever been the recipient of one of my email missives with subject This is not going to end well you already know where I’m going with this post.
When I stumbled across Zecco recently it was not clear how long it would take – or if it would even take – however one thing was clear, something disruptive was now in the air. Well, there was a bit of a reaction and Bank of America lopped of commissions for a number of its customers; yep, free trades. Nice one.
Bank of America (BAC) stunned the online brokerage industry Wednesday by offering free stock trades to anyone who has $25,000 in a checking, savings or money market account at the bank. That came just days after Ontario, Calif.-based upstart Zecco.com offered free trades to anyone with a $2,500 account.
So, what happens next? You guessed it, the online brokerage stocks loose their wind, their market caps take a hit. So who had the cojones, as Madeleine Albright would say, to make the short side bet?
Online brokerages price war, this is not going to end well.
Who would have thought little Zecco would bring B of A to bend so quickly? *he flashes an evil grin, even though he did not short any of the brokerages this week*
