At least to the casual observer, Citigroup posted earnings Friday that weren't just bad, they were horrendous: A $5.1 billion loss, some $16 billion in writedowns from bad loans and layoffs to the tune of 9,000 workers.

But in throwing in the kitchen sink--and everything else laying around the house--Citigroup

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[C  Loading...      ()   ] saw its shares soar 7 percent, taking the rest of the stock market along with it.

Call it the 'T' word: Transparency.

Even those bracing for more losses from financial firms see the logic of bad news translating into good news. Investors just want to know what's on their plate, even if they don't like the taste, and that's what Citigroup provided, along with a plan for recovery.

"The kitchen sink has gone in, but not necessarily all of the plumbing in the basement has been examined," said Diane de Vries Ashley, managing partner of Zenith Capital Partners in Florida. "There's no question that the earnings from the major houses have all been pretty spectacular in their negativism."

Will this continue? "To a degree, I think so," Ashley said. "Why is the stock market going up? It's beginning to look identified. It has a quantitative quality to it. It's not just rumors, it's not just speculation as to what it might be."

Ashley is one money manager bullish on financials now that the sector has suffered through months of plummeting share prices. Most market pros, however, think it's still too early for investors to jump in.

Like Citicorp on Friday, Merrill Lynch

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[MER  Loading...      ()   ] faced a similar reception from the market on Thursday, when it reported $6.5 billion in fresh writedowns and announced an additional 3,000 layoffs. Its stock gained a stunning 7 percent.

But despite this kitchen-sink mentality, some think traders are deluding themselves into thinking that the worst is over for the beaten-down big financials.

"These banks are such black boxes that even the people running them don't know what their writeoffs are going to be quarter to quarter," said Chris Mayer, banking analyst and author of the newly released "Invest Like a Dealmaker." "I think there are a lot of eager bottom-pickers still trying to snatch up financials, which tells me that the bear market in these things is not over."

Mayer and others believe the complex instruments the banks used to finance subprime loans make a clear picture on the extent of the fallout unclear, at least to this point. Only time, they say, will allow the damage to unwind and the institutions to regain Wall Street's faith.

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