Stocks Rise on Upbeat Memo From Citigroup

By THE ASSOCIATED PRESS Published: March 10, 2009

Stocks are rising after troubled Citigroup said it operated at a profit during the first two months of the year.

The Citi chief executive Vikram S. Pandit said the bank had an operating profit of $8.3 billion before taxes and special items through February. Word of the bank’s performance is breaking, at least for the moment, a torrent of bad news from the banking industry that has pounded financial stocks and in turn, the overall market.

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A leaked memo that shows a profit, before accounting for the black hole, and the market goes up 4% in an hour. On the one hand this demonstrates how desperate the investor is for "good" news. On the other hand it shows what idiots the investors are. Citigroup is one of the biggest parts of the black hole. Peacenik has not read anyone, other than the author of this memo, who thinks Citigoup can survive. After a few bagholders cash out their positions the market will continue its march towards zero. Was this leaked memo a criminal attempt to manipulate the market. Is anyone going to investigate. Yawn. It is so farcical that even this event can only draw a yawn. This is what the stock market has become.

Why Bankruptcy For Autos But Not Banks?

The news this morning would be amusing if it weren’t so sad.

The Obama administration is undergoing a battle between its own good instincts with those of its Treasury Secretary.

Away from Treasury, on the side of intelligence, new policies, a clean break from the Paulson/Bush plans — I believe during the campaign, it was called CHANGE — and inevitability, are prepackaged bankruptcies, clean balance sheets, and a fresh start. This is reflected in the Fed exploration of $40 billion in bankruptcy funding for GM.

On the side of more of the same, bad decision making, regulatory capture, worshiping sacred cows, and a hard-to-understand goal of saving the banks rather than the financial system, is the utterly absurd proposal to somehow spend 10X the market cap of Citigroup for a 40% stake in the apparently insolvent firm.

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The fact that this discussion about the bankruptcy of GM and Chrysler and the insolvency of CITI and BofA is not surprising is the biggest surprise of all. Just months ago, the economy was sound according to our lying leaders. Just months ago, the banking system was strong according to those same leaders. Just months ago GM and Chrysler had survival plans: they were going to sell 10 million vehicles this year. They will be lucky to sell 2 million.

Peacenik wants to know the following answers: Will those who know the truth and have the facts start telling the truth? Would someone start cataloguing the lies we've been told? Is the Canadian banking system solvent? Are Canadian pension plans solvent? What happens to GM and Air Canada and countless other pensioners if their pensions go poof? It is time for citizens to be told the truth. It is time for citizens to demand the truth.

Citigroup Goes To Sleep

It's the end of the line for Citigroup. The "group" will soon be gone as Pandit Dismantles Weill Empire to Salvage the Bank Within Citi.

Vikram Pandit is unraveling his empire to save his bank. Citigroup Inc.’s chief executive officer said yesterday he would cede control of the Smith Barney brokerage to Morgan Stanley. Pandit may also dump the CitiFinancial consumer-lending unit, tag Tokyo-based Nikko Asset Management Co. for eventual sale and rein in trading with the bank’s own capital, people familiar with the matter said.

Some current and former Citigroup executives place the blame for the firm’s troubles on Weill. He refused to spend enough on technology and failed to integrate the new companies he acquired, say people familiar with the matter.

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Peacenik can barely process all the bad financial news Peacenik is reading. Here is a story about the demise of Citigroup, one of he biggest banks in the world. It is broke. And the reaction of the media and the public? Yawn. The public has been inured to bad fiscal news now. Your bank is broke or going broke? Yawn. The Phoenix Coyotes are bankrupt? Yawn. Peacenik wonders when ATMs will suddenly stop functioning. Peacenik forgets how to bank in person. Does in-person banking still exist? Oh well, Wayne Gretzky is a great Canadian.