WEEKEND READ

Forget Saints. It's preferreds that are marching in now.
Bank preferreds.

With interest rates lower than low, a niche' is being fulfilled, according to the WSJ.

Financial firms so far this year have unloaded nearly $14 billion of these preferred shares in the U.S. It's the fastest such an amount has sold this early since 2008.

In the hierarchy of stocks preferreds usually stand in front of common shares should something go shake, rattle and broke. Preferreds are like bonds, however, and when interest rates rise share values sink. Just the reverse is also true.

Right now the ducks are quacking--in this case, they're two sets of ducks, the yield starved public and big banks that seek to repair or bolster their balance sheets.

Now the Journal article says this allows banks to help themselves without hurting shareholders. But you might want to add a "Not so fast!" to that.

The yield might look appetizing now in this low-interest rate scene, but when rates start back up--and they will--these gems could belly flop. The surprise might be higher rates than anyone foresees. It wouldn't be the first time.

So if you're thinking about them read the fine print carefully. Are they callable, putable, accumulative are just a few of the things you want to know.

It remains to be told if they turn out to be Saints.