Tag Archives: Citigroup

By The Numbers: 20 Facts About The Collapse Of Europe That Everyone Should Know

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The Economic Collapse Blog | January 9 2013

The economic implosion of Europe is accelerating.  Even while the mainstream media continues to proclaim that the financial crisis in Europe has been “averted”, the economic statistics that are coming out of Europe just continue to get worse.  Manufacturing activity in Europe has been contracting month after month, the unemployment rate in the eurozone has hit yet another brand new record high, and the official unemployment rates in both Greece and Spain are now much higher than the peak unemployment rate in the United States during the Great Depression of the 1930s.  The economic situation in Europe is far worse than it was a year ago, and it is going to continue to get worse as austerity continues to take a huge toll on the economies of the eurozone.  It would be hard to understate how bad things have gotten – particularly in southern Europe.  The truth is that most of southern Europe is experiencing a full-blown economic depression right now.  Sadly, most Americans are paying very little attention to what is going on across the Atlantic.  But they should be watching, because this is what happens when nations accumulate too much debt.  The United States has the biggest debt burden of all, and eventually what is happening over in Spain, France, Italy, Portugal and Greece is going to happen over here as well.

The following are 20 facts about the collapse of Europe that everyone should know…

#1 10 Months: Manufacturing activity in both France and Germany has contracted for 10 months in a row.

#2 11.8 Percent: The unemployment rate in the eurozone has now risen to 11.8 percent – a brand new all-time high.

#3 17 Months: In November, Italy experienced the sharpest decline in retail sales that it had experienced in 17 months.

#4 20 Months: Manufacturing activity in Spain has contracted for 20 months in a row.

#5 20 Percent: It is estimated that bad loans now make up approximately 20 percent of all domestic loans in the Greek banking system at this point.

#6 22 Percent: A whopping 22 percent of the entire population of Ireland lives in jobless households.

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Pat Garofalo ~ Wall Street CEO Gets $6.7 Million Payout After Crashing His Company

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Nation of Change | November 12 2012

Citigroup CEO Vikram Pandit was pushed out the door of his company in October after overseeing a precipitous decline in his bank’s value. Overall, Citigroup lost nearly 90 percent of its stock price during Pandit’s tenure. But that won’t stop Pandit from walking off with $6.7 million for his last year on the job:

Citigroup said Friday that the former CEO, who resigned last month in a management shakeup, will receive an “incentive award” of $6.7 million for his work at the bank this year.Former president and chief operating officer John Havens, who stepped down along with Pandit, is getting $6.8 million, according to a filing with the Securities and Exchange Commission.

The two men will also continue collecting deferred cash and stock compensation from last year, awards valued at $8.8 million for Pandit and $8.7 million for Havens.

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Keiser Report ~ Banksters Bilking Billions (E340)

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 | September 13 2012 | Thanks, Minty

In this episode, Max Keiser and Stacy Herbert discuss David Cameron appointing former bankers to Treasury. We look at another former banker who became a Treasury Secretary only to become a bankster – Robert Rubin – and his role in Citigroup bilking Abu Dhabi of billions. In the second half of the show, Max Keiser talks to Reggie Middleton about Facebook, fraud and financialization.

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Susanne Posel ~ Morgan Stanley Is Insolvent – Only A Matter Of Time Before Total Financial Collapse

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Occupy Corporatism | August 30 2012 | Thanks, A.L.

The fall of the House of Morgan has begun as stock prices on the global market at Morgan Stanley (MS) begin to fall on the New York Stock Exchange (NYSE).

According to Rick Wiles : “I’m hearing rumors that another major financial house is going to implode. In fact, the name I’ve been given is Morgan Stanley . . . It’s going to be put on the sacrificial alter by the financial elite.”

MS, technically speaking, is classified as insolvent based on mark-to-market valuation. By selling off non-core assets, MS has been able to “reduce its European exposure” through the manipulation of hedge funds and allocation of funds to failing financial corporations. Some mainstream media outlets tout that the Federal Reserve Bank will come in and assist MS in their insolvency and that MS “just isn’t going out of business anytime soon.”

However, on the bond market, MS is being treated like “a junk-rated company.” Moody’s the rating agency that sells their ratings to whomever will pay for a triple A score, have announced they will downgradge MS’ ratings which would put all US banks at risk.

Otis Caset, director of credit research at Markit confirms: “What has driven that, obviously, is Europe. The perception is — correctly or incorrectly — that Morgan Stanley is one of the U.S. banks most exposed to Europe’s problems.”

In 2008, with the first pre-meditated financial explosion , the cause for the bailout of the banks was a large sum of cash needed quickly to repay China who had purchased large quantities of mortgage-backed securities that went belly-up when the global scam was realized. When China realized that they had been duped into buying worthless securitized loans which would never be repaid, they demanded the actual property instead. The Chinese were prepared to send their “people” to American shores to seize property as allocated to them through the securitized loan contracts.

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Matt Taibbi ~ Why Did Inventor Of ‘Too Big To Fail’ Change His Mind?

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RS_News | August 4 2012

There were a great many fascinating moments in the now-legendary Squawk Box interview of former Citigroup chairman Sandy Weill, in which the creator of the Too-Big-To-Fail model told an astonished Andrew Ross Sorkin that it was time to break up the Too-Big-To-Fail banks. But one moment in particular flew under the radar:

SORKIN: But did this come to you in 2008, 2009, was there a conversation you had with someone, because this is a true revolution.

WEILL: Change. You know I think it is something I’ve been thinking about a lot over the last year and I wanted to really get my thoughts together before I said anything. But I think good things are simple and I think what I’m saying is very simple.

For the moment we can ignore the fact that Weill throughout the interview kept patting himself on the back for his “good thing” of an idea. (Although, if close attention is paid, one does get the impression that Weill sincerely believes he came up with the “break up the banks” idea on his own, and it’s almost like he’s preparing to take credit for it if it happens; this is just one of the many layers of delicious comedy that can be peeled back through careful re-examination of this interview). We can just call all that background noise for now.

Instead, let’s just focus on the “when” question Sorkin raised. Because interestingly enough, Weill addressed this very issue at the close of the year Sorkin mentioned, 2009.

It was back then that Weill’s former co-C.E.O. at Citi, John Reed, paved the way for Weill’s future conversion by issuing his own mea culpa on the issue of Too-Big-To-Fail. Reed wrote a letter to the New York Times on October 22, 2009 calling for the same division of commercial banks and investment banks, saying the repeal of the Glass-Steagall Act, which had kept those companies separate, was a mistake.

“I would compartmentalize the industry for the same reason you compartmentalize ships,” Reed toldBloomberg later on. “If you have a leak, the leak doesn’t spread and sink the whole vessel. So generally speaking you’d have consumer banking separate from trading bonds and equity.”

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Matt Taibbi ~ Ludicrous Times Op-Ed Forgets Entire Year of Wall Street History

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Rolling Stone | RS_News | August 2 2012

OPINION ~ It was riotous, side-splitting comedy last week when Sanford Weill, the onetime head of Citibank, went on CNBC to announce that he thought it was time to break up the big banks.

Why this was funny: Through his ambitious (and at the time not yet legal) decision to merge Citibank, Travelers, and Salomon Brothers into one giant wrecking ball of greed, self-dealing and global irresponsibility called Citigroup, Weill more or less single-handedly created the Too-Big-To-Fail problem. You know, the one currently casting that thick, black doomlike shadow over all humanity which, if you look out your window, you can see floating over all our heads this very minute.

Nonetheless, Weill came out last week against Too Big to Fail banks. “I’m suggesting,” he told astonished reporters on a live CNBC interview, “that they be broken up so that the taxpayer will never be at risk…. What we should probably do is go and split up investment banking from banking.”

The interview became an instant YouTube classic. The very funniest part, I thought, was the response of Squawk Box host Andrew Ross Sorkin, the single most credulously slobbering financial reporter on the planet this side of Maria Bartiromo. Even he was so shocked by Weill’s comments that he lost his voice – “I’m speechless,” he said.

At about the 1:20 mark of the clip, just after Weill offered his incredible opinion about the need to break up the banks, any sensible reporter would have pounced. Some version of, “Dude, are you high? Youinvented Too Big To Fail!” would have been the proper response – followed hopefully by a spirited lunge across the set to beat Weill repeatedly about the neck and head with a Swingline stapler, until he screeched out a tearful apology to every last living soul on earth.

Instead, Sorkin took another tack:

“Okay, so then the question becomes – Glass-Steagall,” Sorkin said. “You’re almost referring to bringing back Glass-Steagall, in some respects.”

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Greg Hunter ~ Weekly News Wrap Up July 27 2012 [Video]

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USA Watchdog | July 27 2012

Once again, Syria is at the top of the News Wrap-Up.  Russia is sending a large contingent of marines to Syria.  They will park off the coast, ready to go ashore if needed.  I told you this was not going to go down like Libya.  Russia has a naval base in Syria and is a big ally of the Syrian government.  Now, Iran is saying it will come to the help of the Syrian government and will not permit a regime change.  This is a bloody civil war that has claimed the lives of nearly 20,000 Syrian citizens.  There is no end in sight.

Treasury Secretary Tim Geithner was in the Congressional hot seat this week.  Geithner was grilled with questions as to why he did not call a halt to the multi-trillion dollar Libor global rate rigging fraud.  The big bankers are going to say Mr. Geithner, who was at the New York Fed when this started, basically gave his tacit approval for the fraud.  I look for him to be sacrificed by the bankers over this mess.

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Robert Scheer ~ Libor Interest Rate Scandal: Crime of the Century

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Common Dreams | July 6 2012

Barclays Bank chairman Marcus Agius, (L) chief executive Bob Diamond (C) and chief operating officer Jerry Del Missier. (AFP)

Forget Bernie Madoff and Enron’s Ken Lay—they were mere amateurs in financial crime. The current Libor interest rate scandal, involving hundreds of trillions in international derivatives trade, shows how the really big boys play. And these guys will most likely not do the time because their kind rewrites the law before committing the crime.

Modern international bankers form a class of thieves the likes of which the world has never before seen. Or, indeed, imagined. The scandal over Libor—short for London interbank offered rate—has resulted in a huge fine for Barclays Bank and threatens to ensnare some of the world’s top financiers. It reveals that behind the world’s financial edifice lies a reeking cesspool of unprecedented corruption. The modern-day robber barons pillage with a destructive abandon totally unfettered by law or conscience and on a scale that is almost impossible to comprehend.

How to explain a $450 million settlement for one bank whose defense, in a plea bargain worked out with regulators in London and Washington, is that every institution in their elite financial circle was doing it? Not just Barclays but JPMorgan Chase, Citigroup and others are now being investigated on suspicion of manipulating the Libor rate, so critical to a $700 trillion derivatives market.

Caught as the proverbial deer in the headlights, Barclays Chairman Robert E. Diamond Jr. resigned this week and offered a plaintive defense to the British Parliament that he learned only recently that his bank was manipulating the index on which so large a part of international trade is based. That is plausible only if we assume he was paid $10 million a year to be deliberately ignorant. The Wall Street Journal had exposed this scandal fully four years ago but his bank continued to participate in it nonetheless.

“Study Casts Doubt on Key Rate” was the headline on the May 29, 2008, investigative report, which concluded: “Major banks are contributing to the erratic behavior of a crucial global lending benchmark, a Wall Street Journal analysis shows.” Even then, according to the report, it was known that the Libor rate was being manipulated “to act as if the banking system was doing better than it was at critical junctures in the financial crisis.”

Fast-forward four years to Diamond’s testimony before Parliament this week in which the CEO claimed his recent discovery of a pattern of interest manipulation by Barclays had made him “physically sick.” Who was to blame? According to the executive, subordinates acting behind his back.

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Jim Hightower ~ Coddling The 10 Percent

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Nation Of Change | May 14 2012

Another way that the rich are different from you and me is that their bankers serve them freshly baked chocolate-chip cookies.

The über-rich, of course, are used to such coddling, but now a class of customers that bankers have dubbed the “mass affluent” get cookies, too. Think you might qualify? You do… if you have a minimum of $500,000 to open one of these mass-affluent accounts. Otherwise, you fall into a category called “lower-margin” customers — so go get in the ATM line, Bucko.

This half-million-dollar-and-up bunch are not the 1-percenters. Instead they are the 10-percenters, and they’ve suddenly become hotly coveted by JPMorgan Chase, Citigroup, Bank of America, and other big chain banks. To reel in these mid-level richies, bankers are offering to pamper them lavishly.

For example, rather than having to breathe the same air as the riff-raff, they get to bank in cushy, private lounges. The carpets are plush, the cookies fresh, and a nice touch of wine and cheese might be available. There are no lines and no tellers to deal with – instead, these affluent swells get “relationship managers” who cater to their banking needs, including being available after hours. And here’s something completely astonishing: one bank president says of her advantaged clients, “We’ll come to you. If you want us to meet you in your home on a Sunday, we’ll do that.”

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Robert Scheer ~ For He’s a Jolly Good Scoundrel

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Truthdig | April 18 2012

Sanford Weill

How evil is this? At a time when two-thirds of U.S. homeowners are drowning in mortgage debt and the American dream has crashed for tens of millions more, Sanford Weill, the banker most responsible for the nation’s economic collapse, has been elected to the American Academy of Arts & Sciences.

So much for the academy’s proclaimed “230-plus year history of recognizing some of the world’s most accomplished scholars, scientists, writers, artists, and civic, corporate, and philanthropic leaders.” George Washington, Ralph Waldo Emerson and Albert Einstein must be rolling in their graves at the news that Weill, “philanthropist and retired Citigroup Chairman,” has joined their ranks.

Weill is the Wall Street hustler who led the successful lobbying to reverse the Glass-Steagall law, which long had been a barrier between investment and commercial banks. That 1999 reversal permitted the merger of Travelers and Citibank, thereby creating Citigroup as the largest of the “too big to fail” banks eventually bailed out by taxpayers. Weill was instrumental in getting then-President Bill Clinton to sign off on the Republican-sponsored legislation that upended the sensible restraints on finance capital that had worked splendidly since the Great Depression.

Those restrictions were initially flouted when Weill, then CEO of Travelers, which contained a major investment banking division, decided to merge the company with Citibank, a commercial bank headed by John S. Reed. The merger had actually been arranged before the enabling legislation became law, and it was granted a temporary waiver by Alan Greenspan’s Federal Reserve. The night before the announcement of the merger, as Wall Street Journal reporter Monica Langley writes in her book “Tearing Down the Walls: How Sandy Weill Fought His Way to the Top of the Financial World … and Then Nearly Lost It All,” a buoyant Weill suggested to Reed, “We should call Clinton.” On a Sunday night Weill had no trouble getting through to the president and informed him of the merger, which violated existing law. After hanging up, Weill boasted to Reed, “We just made the president of the United States an insider.”

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Livin’ in a Bankster’s Paradise

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Charles P. Pierce, Esquire | RS_News | February 17 2012

OPINION | If all the things for which I have little patience – Willard Romney, lottery machines in convenience stores, and the current state of the Montreal Canadiens, to name only three – the notion that the best way to deal with things is to “look forward, not back” is right at the top of the list. This is especially true as regards the undeniable fact that, over the course of a decade, a bunch of cheats, thieves, and suited mountebanks stole most of the national economy and then wrecked whatever was left of it. But what’s most extraordinary about the whole thing is that, after they swindled their swindles and heisted their heists, and got paid off by the rest of us for having looted our naional economy, they all kept doing the same things they were doing before. These included extravagant bonuses and, of course, continued crimes of capital that ought to be capital crimes.

This is extraordinary. All this Citigroup fraud and thuggery took place after the events of the great meltdown had taken place. This whisteblower’s co-workers, instead of checking for fraud or making reports about underwriting defects to the FHA as required, argued with her over the soundness of the loans, she said. Employees who acted as “gatekeepers” applied “what they describe as ‘brute force’ to pressure Citi’s quality control managers” into downplaying defects, according to the government’s complaint.

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The Party People of Wall Street

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Bill Moyers & Michael Winship (Common Dreams) | RS_News | January 31 2012

OPINION | A week or so ago, we read in The New York Times about what in the Gilded Age of the Roman Empire was known as a bacchanal – a big blowout at which the imperial swells got together and whooped it up. [The St. Regis Hotel in Manhattan was the site of a black-tie dinner for Kappa Beta Phi, whose members were told "what happens at the St. Regis stays at the St. Regis." (John Marshall Mantel for The New York Times))] The St. Regis Hotel in Manhattan was the site of a black-tie dinner for Kappa Beta Phi, whose members were told “what happens at the St. Regis stays at the St. Regis.”

This one occurred here in Manhattan at the annual black-tie dinner and induction ceremony for Kappa Beta Phi. That’s the very exclusive Wall Street fraternity of billionaire bankers, and private equity and hedge fund predators. People like Wilbur Ross, the vulture capitalist; Robert Benmosche, the CEO of AIG, the insurance giant that received tens of billions in bailout money; and Alan “Ace” Greenberg, former chairman of Bear Stearns, the failed investment bank bought by JPMorgan Chase.

They got together at the St. Regis Hotel off Fifth Avenue to eat rack of lamb, drink and haze their newest members, who are made to dress in drag, sing and perform skits while braving the insults, wine-soaked napkins and petit fours – those fancy little frosted cakes – hurled at them by the old guard. In other words, a gilt-edged Animal House, food fight and all.

This year, the butt of many a joke were the protesters of Occupy Wall Street. In one of the sketches, the bond specialist James Lebenthal scolded a demonstrator with a face tattoo, “Go home, wash that off your face and get back to work.” And in another, a member – dressed like a protester – was told, “You’re pathetic, you liberal. You need a bath!”

Pretty hilarious stuff. The whole affair’s reminiscent of the wingdings the robber barons used to throw during America’s own Gilded Age a century and a half ago, when great wealth amassed at the top, far from the squalor and misery of working stiffs. Guests would arrive in the glittering mansions for costume balls that rivaled Versailles, reinforcing the sense of superiority and the virtue of a ruling class that depended on the toil and sweat of working people.

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