ABC News: Citi, AIG Won't Drop Big Sports Sponsorships

ABC News ^ | November 24, 2008 | Justin Rood

[Zakeet]

AIG, Citibank and a number of other federally bailed-out financial institutions have no plans to cancel hundreds of millions of dollars in sports team sponsorships, even as they take billions in taxpayer support, ABC News has found.

In boom times, the sponsorships were seen as a way to advertise the firms' "brands" and appeal to potential customers. Even today, at least one bank told ABC News that a naming deal was increasing its revenue. But critics, including a member of Congress, say the decision to continue them now is hard to defend.

Struggling Citibank just sealed a multi-billion-dollar emergency "backstop" deal with the U.S. government. The financial behemoth, suffering with billions in bad mortgage-related assets on its books, recently shed 53,000 workers and saw its stock price lose over half its value. Yet it's in a 20-year contract to pay the New York Mets $400 million to name the team's new stadium "Citi Field."

"This type of spending is indefensible and unacceptable to Citigroup's new partner and largest investor: the American taxpayer," said Rep. Elijah Cummings, D-Md., in a statement Monday.

Citi isn't alone: Imploding insurance giant AIG is paying the British soccer team Manchester United $125 million for the privilege of having its logo appear on Man U's uniforms. That, despite the fact the firm is standing largely thanks to a $150 billion lifeline from the U.S. Treasury.

"A friend of mine joked they should put 'US Treasury' on the front of their uniforms," said Steve Ellis of Taxpayers for Common Sense, a Washington, D.C.-based nonpartisan watchdog group which is outraged by the expenditures.

[Zakeet]

Taxpayer money put to good use.,P.

[Diogenesis]

"Money for nothing, and the chicks for free."

[frankiep]

Now I have even more of a reason to boycott going to Mets games now that Shea Stadium is gone.

[HD1200]

I avoid products that spend money advertising on expensive players that know how to play children’s games well for people with no lives or have ludicrous expensive clowns that know how to hit a golfball well like Tiger Woods on the payroll.

[Vn_survivor_67-68]

Prince Alwaleed Lauds US Bailout Of Citi As Stabilizing -CNBC
Last update: 11/24/2008 2:54:12 PM
DOW JONES NEWSWIRES
The single largest shareholder of Citigroup Inc. (C) praised the financial giant’s rescue by the U.S. government, calling the “dramatic” move necessary and expressing confidence that current management will turn things around.
Prince Alwaleed bin Talal bin Abdulaziz Al Saud, a member of Saudi Arabia’s royal family and a billionaire investor, told CNBC on Monday that the government action late Sunday further vindicates his decision last week to raise his stake in Citigroup to 5% from under 4% because the shares were undervalued.
“We hope this will stabilize the situation,” he said. “Really, the problem is very much centered around perception.”
The government late Sunday pledged to build its stake in Citigroup by purchasing another $20 billion in preferred shares and said it would back up to $306 billion worth of the bank’s assets in return for a further $7 billion stake. Citi will also limit its executives’ pay, sharply reduce its dividend and work with the government on home loans.
Prince Alwaleed reiterated his belief that Chief Executive Vikram Pandit is the right leader for Citi and that his relatively brief tenure - Pandit was named CEO last December - means he’s not responsible for the company’s recent losses.
“The fact that (Pandit) and his able management team were kept intact (amid the bailout) is a major vindication,” the prince said. “He has my full confidence.”
Referring to Pandit’s predecessor as CEO, the Saudi royal said: “Chuck Prince is a very good man, he’s a good gentlemen, he’s a good friend of mine. But frankly speaking, the destruction of wealth that took place lately, clearly has to be attributed to the previous management.”
Prince Alwaleed, one of the Middle East’s biggest foreign investors, first took a stake in Citi in early 1991. He is estimated to be the world’s 19th-richest person by Forbes magazine, with a fortune of $21 billion.

[Boiling Pots]

http://www.theonion.com/content/video/in_the_know_should_the_government

[JerseyHighlander]

Vienna World's Fair, 1873

Above is the fantastic pavilion of the Austo-Hungarian Lloyd, at the Vienna World's Fair, in 1873. What a proud crew! And of course they're proud; it was the fifth expo to ever be held, and the first in a German-speaking country.

Vienna was ready to show the world just how cosmopolitan and economically powerful they really were. Unfortunately, just a few days after the opening ceremony, their stock market crashed. There was some serious weeping and gnashing of teeth. And severe unemployment and depression.

After that, the cholera epidemic began to spread, which was kind to no one, including visitors of the fair.

And then... the floods. Which damaged many of the buildings, and that really sent things to hell.

All in all, it was a financial disaster; Vienna never again hosted another fair.

More photos of the 1873 expo here

Yeah, that's where I think we're headed.

[Wiggins]

A family member bought me a bottle of Jose Reyes wine and I promptly exchanged it for something else.

[21twelve]

Interesting and disturbing.

As if the Crash of ‘29 and the New Deal weren’t bad enough - throuw in the Dust Bowl and it becomes almost Biblical. It would not surpise me if this time it was compounded by Bird Flu.

[onlylewis]

Why not just have AIG and Citicorp sell of the profitable arms of their company, with gov’t oversight (since they love to get involved in private business) and then restructure the rest?

Oh that's right that would make sense.

[Arguendo]

"This type of spending is indefensible and unacceptable to Citigroup's new partner and largest investor: the American taxpayer," said Rep. Elijah Cummings, D-Md., in a statement Monday.

Good point, Rep. Cummings. It's not like politicians would ever spend taxpayer money on sports stadiums.