Chronicles Of Depression 2.0: #223: CitiGroup Blinks
I’d been waiting and waiting and waiting for something to come out of CitiGroup.
The losses there would scare the living shit out of you, if you knew the full story.
Now they’ve blinked.
Ironically, a memo that was sent around to employees made the New York Times just last week: Pandit Memo Seeks to Rally Citi Employees
Here’s an interesting take on that hedge fund:
Recently, Prof Peter Morici wrote in Finfacts: …the banks’ problems are much deeper and far reaching than their losses on subprime securities. Citigroup’s losses on Old Lane hedge fund provide a classic illustration. To attract CEO Vikram Pandit, Citigroup purchased Old Lane for $800 million. Although the fund never made much profit, the transaction netted Pandit $165 million. Subsequently, Citigroup wrote down more than $200 million in losses. Pandit used some of his proceeds to purchase the late actor Tony Randall’s Manhattan apartment for $17.9 million, and Citigroup shareholders took the loss. Nothing Bernanke has proposed will stop that kind of reckless behavior, which has nothing to do with the subprime debacle.
The greedy chicken comes home to roost.
And here’s some recent behind-the-scenes CitiGroup action: Krawcheck departure sparks Citi shake-up
Much more to come, I’m sure.