Citigroup May Face $24 Bil Writedown, Cut 24,000 Jobs
MoneyNews
Monday, Jan. 14, 2008
NEW YORK -- Citigroup Inc, the largest U.S. bank, may eliminate 17,000 to 24,000 jobs and write off as much as $24 billion for subprime and other credit losses, as part of a plan to cut costs and add capital, CNBC television said on Monday.
The write-down and job cuts may be announced on Tuesday, CNBC said, when Citigroup is widely expected to report the largest quarterly loss in its history.
Analysts on average expect the loss to be about $5 billion, according to Reuters Estimates.
Citigroup may also reduce its 54 cents per share quarterly dividend, which equates to a 7.6 percent dividend yield. It may also raise billions of dollars of new capital from various entities, including from its largest individual shareholder, Saudi Prince Alwaleed bin Talal, published reports said. The bank sold a $7.5 billion stake to Abu Dhabi's government in November.
http://moneynews.newsmax.com/money/archives/articles/2008/1/14/142638.cfm?s=mnh
Foreign Cash Pours Into USA
MoneyNews
Monday, Jan. 14, 2008
Foreign companies burned by the Dubai ports deal have discovered a new way to influence American companies -- buying stakes in U.S. companies via so-called "sovereign wealth funds," or SWFs.
Record amounts of foreign government money have flooded into U.S. markets this year in the form of SWFs -- pools of foreign-government money controlled by foreign governments.
Major U.S. companies including Citigroup and Merrill Lynch, desperate for cash following the subprime mortgage crash, have turned to Asian and Arab financiers for a bailout.
SWFs from those nations have used their billions of dollar reserves to rescue troubled U.S. firms.
Sources tell Newsmax the foreign SWFs have bought beleaguered companies at bargain-basement prices as the credit-market crisis unfolded. The SWFs have carefully avoided taking substantial voting stakes in those companies, however, sources tell Newsmax.
Such funds are growing fastest in the Mideast -- thanks to the overflowing oil revenues pouring into government coffers there. Another hot region: China and East Asia, flush with cash due to the region's soaring trade surpluses.
http://moneynews.newsmax.com/money/archives/articles/2008/1/14/105751.cfm?s=mnh
Faster horses said:Great post, bhb...I enjoyed some POSITIVE NEWS.
Thank you for a nice start to the day.
Holding Fast. After the other deputy's call, Mutters drove to the slag heap and checked with a mining official, who assured him that the dam was holding fast. Unconvinced, Mutters set out in his car to spread the alarm. But there was too little time, and the people of Buffalo Creek had been threatened too often before with false alarms about the dam. Some time after 8 a.m., the wall of slag burst open "like a bomb had hit it," according to one witness, and a huge mountain of water and sludge descended on the hollow, trapping many people still asleep.
2007 Wholesale Inflation Up Most in 26 Years
MoneyNews
Tuesday, Jan. 15, 2008
WASHINGTON -- Wholesale inflation shot up in 2007 by the largest amount in 26 years even though falling gasoline costs allowed price pressures to moderate in December.
The Labor Department reported that wholesale inflation was up 6.3 percent for all of 2007, reflecting a huge increase for the year in various types of energy costs ranging from gasoline to home heating oil.
http://moneynews.newsmax.com/money/archives/articles/2008/1/15/084653.cfm?s=mnh
ff said:Faster horses said:Great post, bhb...I enjoyed some POSITIVE NEWS.
Thank you for a nice start to the day.
That's a rant, not news.
Money just doesn't disappear. It goes somewhere.
Oldtimer said:Money just doesn't disappear. It goes somewhere.
Dow just dropped another 280 points-- over 2%...NASDAQ down 60 points- 2 1/2 %...
Where did that money go?
The republican party is no longer the part of fiscal conservatism, balanced budgets, smaller government, or the business community as a whole.
backhoeboogie said:Oldtimer said:Money just doesn't disappear. It goes somewhere.
Dow just dropped another 280 points-- over 2%...NASDAQ down 60 points- 2 1/2 %...
Where did that money go?
It simply means someone bought stock for less than what it sold for at yesterday's close. Someone was willing to sell for a lower price and someone was willing to buy at a lower price. Not much different than a cattle auction when prices are down. If you buy when prices are up and sell when they are low, you lose money.
For me personally it means my small cap growth equity is down 9% for the year. My large cap growth equity is down 7.3%. Both are way higher than what they were back when I bought in. Hence, I didn't make as much profit based on the current close as I did based on Dec closes. (good thing I pulled a bunch when I did). Stocks are way ahead of my savings interest, CDs, and other things in my portfolio.
Now if it really bottoms out, I will pull all my savings and sink them in the stock market and buy at low prices. Kind of like buying F-1s with ear from the sale barn at really low prices.
Oldtimer said:Don't worry if you can't answer it-- I've seen it asked of many economists that can't answer it.....Nobody gains any $ value out of it--But they have to agree that the value of the total stocks is lower- and the value of the stockholders portfolio is lower- and the wealth of the nation is lower- because it can't be converted to the cash value it was....
backhoeboogie said:Oldtimer said:Don't worry if you can't answer it-- I've seen it asked of many economists that can't answer it.....Nobody gains any $ value out of it--But they have to agree that the value of the total stocks is lower- and the value of the stockholders portfolio is lower- and the wealth of the nation is lower- because it can't be converted to the cash value it was....
How can something like that be answered?
Perhaps I don't look at it the way you do. If you buy a cow for $900 and you sell it to me for $950. It closed "up $50". I hold the cow a year and sell a calf (dividend). Get her bred again and sell her for $925. Wallstreet can say she closed at $25 less than the last time she sold.
That is how I look at stocks. You made money on the cow you bought. I made money on the calf but lost $25 on the cow. Now someone else might offer $1100 if they want her bad enough (I should have held her). She's still the same cow you bought for $900. Money didn't disappear.
Red Robin said:Oldtimer you can't deny that some funds and portfolios and those on their toes have made fortunes this last week. The market doesn't have to go up to make money.