Daily Archives: November 23, 2008

Good Bank, Bad Bank: Citi & Uncle Sam (C)

Citigroup_logoThe speculation has been brewing all week (longer actually, but let’s move on) where Citigroup, Inc. (NYSE: C) was going.  Many believed an ‘AIG-esque’ package was coming, and many believed a quasi-filing protection was next.  The "run on the bank" fear has gone too deep now to be stopped without any protections, guarantees, and assurances from the government.  That’s why we asked this weekend, "what happens to Citi on Monday morning?"  Then late today came an interesting thought and an interesting scenario.

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Posted on: November 23, 2008 – 5:06 pm in Banking, Financial Stocks, Shareholder Issues, Turnarounds,

Venezuela Pushes For OPEC Production Cuts

Tx00338coilwellgusherodessatexasposThe finances of OPEC companies are being badly undermined by the drop of crude from $147 during the summer to under $60 recently.

Several news reports have indicated that the national budgets in both Iran and Venezuela have moved deeply into the red and that there is extreme pressure for them to improve receipts.

Despite the fact that OPEC cut daily production last month by 1.5 million barrels a day, crude has continued it march downward.

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Posted on: November 23, 2008 – 4:43 pm in Oil & Gas

A Vote For Selling Citigroup (C) To Goldman Sachs (GS) Or Morgan Stanley (MS)

Citi_logoThere had been speculation for almost a week that the government has been trying to broker a marriage between Goldman Sachs (GS) and Citigroup (C). Goldman has apparently been cool toward taking on Citi’s problems even if the Treasury and FDIC are willing to guarantee a large portion of the Citi balance sheet.

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Posted on: November 23, 2008 – 4:10 pm in Mergers and Buy Outs, , ,

What Happens To Citigroup (C) On Monday Morning?

DataIt has come to this. Will the federal government allow the shares of Citigroup (C) to open for trading on Monday morning without a plan in place to support the bank or a buyer for the firm? The way the global markets work, a decision will probably have to be announced before Asia opens.

The risk or Citi trading with no news is that the plunge in its stock could continue. If there is any lesson from Lehman it is that a stock can move toward zero in the blink of an eye. Citi closed Friday at $3.77 but had traded as low at $3.05 that day. The idea that it could go to $2 or below if investors continue to lose confidence in its ability to survive is certainly within the realm of possibility.

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Posted on: November 23, 2008 – 8:01 am in Banking, , , ,