Citigroup Profit Fell 57% in Third Quarter -- well, bye bye CitiBank, too bad you got completely overloaded on bad housing loans.... if I had money in that bank, I'd be taking it out right about now!!
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CitiGroup is collapsing!!
- Thread starter PacificPandeist
- Start date
I have no good hopes for a corporate monolith such as this.... lets let it die and get back to community banks serving community interests!!
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Voegelin
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- Aug 18, 2003
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The early 20th century "progressive" passion for small community banks spearheaded by Louis Brandeis led to the banking failures of the Great Depression. 90% of the banks which failed were small town banks.
Canada,which allowed nationwide banking, did not have one bank failure during the Great Depression.
Spread the risk among communities and states, have fewer failures. Economics 101. To everyone but the "reformers" of the "progressive" era.
Why Brandeis and others did what they did is up for debate. But there is no escaping the fact that Wall Street and other securities dealers did not want competition from banks in the American heartland.
btw...we've paid over and over again for what happened during that era. Solid banks during the first three decades of the 20th century were not lobbying for Federal Deposit Insurance. They were solid. The small iffy banks wanted it. They wanted to shift their risk to the taxpayer. And they did. The bailouts of the 1980s were a direct result of those small town bankers going to Congress and getting from FDR what they wanted--someone else to assume the risk.
Canada,which allowed nationwide banking, did not have one bank failure during the Great Depression.
Spread the risk among communities and states, have fewer failures. Economics 101. To everyone but the "reformers" of the "progressive" era.
Why Brandeis and others did what they did is up for debate. But there is no escaping the fact that Wall Street and other securities dealers did not want competition from banks in the American heartland.
btw...we've paid over and over again for what happened during that era. Solid banks during the first three decades of the 20th century were not lobbying for Federal Deposit Insurance. They were solid. The small iffy banks wanted it. They wanted to shift their risk to the taxpayer. And they did. The bailouts of the 1980s were a direct result of those small town bankers going to Congress and getting from FDR what they wanted--someone else to assume the risk.
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Has it ever occurred to anyone that Citibank might be fine with collecting up lots of real estate cheap from bad loans?
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MichaelFJF
Well-Known Member
LOL - banks don't want real estate. They want money. And overvalued real estate won't bring in what they loaned on it.
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maybe they want to make citibankopia
check to see if the ceo weres a dark robe and has plans for a death star!!!
check to see if the ceo weres a dark robe and has plans for a death star!!!
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Bank-owned properties fall into disrepair a lot while waiting for a new buyer -- the longer the wait, the worse the situation....
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Lynden1000
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They'll survive. They're taking a hit right now like a lot of other financial companies, but I think they're big enough and have enough cash on the books to pull through.
In the meantime, a 4.7% dividend yield on that stock is no small shakes.
In the meantime, a 4.7% dividend yield on that stock is no small shakes.
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thenewageriseth
Stranger in my town, commoner in my realm
Wow, maybe I need to forward this story to some folks. :O
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Banks never really have any money anyways since they are allowed to lend out ten times the money that they actually have, and then collect interest on the money that they never had. Banks really can't go out of business anymore. Even if they go completely broke the Fed will just set the money printers to "hi" and bail them out.
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Granted I skipped macroeconomics more than I went but I thought they were required to hold everything they owed in the fed, at least in theory.
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Yep, there go our tax dollars (or more accurately, there goes the value of whatever we didn't pay in taxes)....
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simplicity
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I am more concerned about what the decline in profits signifies for the banking sector. As far as I can tell this crisis in housing loans represents a trailing indicator of the housing sector. And with so much recent economic growth in a manner of speaking based on a capitalized expectation of steadiness in the housing sector and the ability to pay for expenses, I wonder about the future implications to corporate profits and therefore to employment over the next 6 to 18 months.
Companies always move to anticipate earnings. I am a little bit concerned that pessimism will be the norm and that large scale layoffs will occur.
Companies always move to anticipate earnings. I am a little bit concerned that pessimism will be the norm and that large scale layoffs will occur.
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