Nothing you read today about Citigroup should surprise you if you read my earlier posts.
Citi will be selling off its assets to raise capital, but if it gets the same fire sale prices it received for Smith Barney the end will come sooner.
Citi, when all is said and done, will be nationalized because its “bad bank” is so much more toxic than any fire sale can cover.
Unfortunately taxpayers will be on the hook after all the capital has be pushed out to the door to cover a portion of its derivative exposure.
Director Robert Rubin left the board because he did not want this break up to happen on his watch. See earlier posts.
CEO Vikram Pandit has his orders to liquidate all good assets before the government takeover.
Next week we will hear of talks of future sales of the Banamex and Primerica units to offset horrible earnings news, which is reportedly a $10B loss for the 4th quarter.