Posted on 11/05/2007 8:15:43 PM PST by Rutles4Ever
Meredith Whitney, the CIBC World Markets' financial services analyst, believes the only way forward for new chairman Robert Rubin and interim chief executive Sir Win Bischoff is to carve the bank up and sell it off.
Asked about the possibility of a Citi break-up, Ms Whitney, who received death threats following her comments last week, said: "That's really the only thing they can do. They don't have the capital to manage it as an ongoing entity."
Ms Whitney's views stem from her belief that Citi does not have enough capital to meet its existing commitments, something the bank denied in a statement on its financing on Sunday evening.
She believes that Citi needs to begin to sell off non-core asserts or cuts its dividend. But chief financial officer Gary Crittenden, a contender to replace Mr Prince, yesterday told banking analysts that Citi has no intention of cutting the dividend.
Ms Whitney responded by saying: "Clearly the maths do not add up."
(Excerpt) Read more at telegraph.co.uk ...
I’ve been paying federal taxes my whole life that have been siphoned off to bail out Citi over and over again, and this looks like the mother of all bailouts coming.
It is stunning that Citibank, one of the biggest, greediest and richist banking conglomerates could get so greedy as to go broke with the billions of dollars in service fees, credit card processing fees, high consumer interest, consumer credit marketing that is endless... that they took too many risks and broke themselves in the process.
Well, the execs won’t have to give back a dime of their fat salaries, so to them it was just a great ride.
flashback time.....
Democrats Hush Up Rubin’s Enron Scandal
NEWSMAX ^ | Carl Limbacher
Posted on 07/25/2002 9:27:24 PM EDT by OPS4
With Carl Limbacher and NewsMax.com Staff For the story behind the story...
Thursday, July 25, 2002 Democrats Hush Up Rubin’s Enron Scandal
Senate Democrats claiming to investigate the collapse of Enron Corp. don’t want to question former Clinton Treasury Secretary Robert Rubin, a top official at Citigroup Inc., about its role in concealing Enron’s debt from investors.
Asked whether he intended to call Rubin as a witness, Sen. Joseph Lieberman, chairman of the Governmental Affairs Committee, said, “I don’t,” the Washington Times reported today.
http://www.freerepublic.com/focus/news/722412/posts
Citigroup is a part-owner of the Federal Government. The American taxpayer will end up covering their losses some way or another.
I remember that well, Robbie Rubin needs to get his a$$ handed to him.
http://www.freerepublic.com/focus/news/626491/posts
Isn’t Rubin, again, a big player at the top?
I want to see what role Clinton's boy wonder, Robert Rubin, had in all this.
Watch your New York senators, Hillary and Schumer at the head of the bail-out parade.
I bought some enron shares @ 27 cents after the close on the friday night before the sunday they filed for BK, so I followed it from that perspective for 2 yrs or so......what an education!!
If citi is as bad off as this chik says, I’ll bet it’ll go the way of Arthur Andersen, and maybe even quicker, to bury all the bodies. Paper shredder prices will soar tomorrow, LOL
I used to engineer the trading floors at the Citicorp bldg. years back.
Would go into the bigshots offices, this one guy was wearing like $1,000 dollar a pair alligator shoes.
certainly the cerberus group would want a chunk
to add to their albertsons and chrysler and ...
properties.
Buy HP stock? Good one..LOL
I'm truly shocked we haven't seen it yet.
If it were simply Citi, then a bailout would come one way or another. Problem is, it’s not just Citi. WaMu is toast. Countrywide is toast. Mortgage insurers are toast. What about Merrill, Morgan, Wachovia, Lehman, UBS - you name it - every major bank is up to their eyeballs in this radioactive waste. Some are more exposed than others.
The ABX index is a screaming bloodbath - AAA tranches - supposedly impervious to damage - are quoting in the 70’s(!) The ABX is an index of credit-default swaps which, although they do not directly measure the bonds, they measure the sentiment towards those tranches. If investors are driving down the value of AAA tranches to hedge against their potential default at these price levels, then these instruments are effectively bankrupt. Once a credit acceleration event takes place and the coupons get cut, it’s going to be a race for the door. Without the junk yield at “AAA-rated” protection, they’re an albatross to every bank, hedge fund, pension, and insurance unit that
invested in them.
Here’s a very sobering analysis of the Citigroup situation:
http://globaleconomicanalysis.blogspot.com/
“Level 3 assets at Citigroup exceed shareholder equity. Now take a look at level 2 assets sitting at $939 billion dollars. A mere 10% haircut in the value of those assets would eat up 74% of working capital. A 10% haircut in Level 2 assets in conjunction with steeper losses in level 3 assets would make Citigroup insolvent.”
^^^ This is what they’re up against.
So is the red Chinese. What really is your point?
If you check out the Fed funds data on this page:
http://www.ny.frb.org/markets/omo/dmm/fedfundsdata.cfm
you will notice that on 10/25, the high overnight rate presented from one bank to another was 15%. That’s not a typo. 15%. That means some bank transacted an overnight loan with another bank that had such horrible collateral to put forward, it had to take a loan-shark rate of 15% to get it done. This is public information and the media doesn’t breathe a word of it.
x42 downside legacy still haunting us.
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