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• The baseball stadium blues

  Posted Jul 21 2008, 02:36 PM by Matt Koppenheffer
  Filed under: CAPS, Banking, Citigroup
  Rating:

  If only investors had listened to me and The New York Times they would have been able to avoid the mess that is Citigroup. Back in late 2006, I noted Citi's $400 million deal that scored the bank naming rights for the new New York Mets stadium and cited a New York Times article that said:
  
  

  Citigroup obviously thinks that the naming rights are valuable, but history does not indicate such deals have done much for other banks, or for the ball clubs that play in them. Stocks of banks with ballparks have tended to do worse than stocks of other banks, and teams in these parks have tended to lose more games than they win.   Read More...

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• Why should you care about Fannie and Freddie?

  Posted Jul 16 2008, 07:48 AM by Todd Harrison
  Filed under: Banking, Citigroup, Housing, stocks, JPMorgan, economy, todd harrison
  Rating:

  Given the daily barrage of bad news about the credit crunch, the mortgage crisis and failing banks, you'd think things would be a lot easier for someone who actually wants to take out a simple home loan.

  As a matter of fact, just this morning you read an article about two mortgage companies, one with a name that sounds like what they call your grandmother at her retirement community, the other like some up-and-coming DJ. Fannie Mae and Freddie Mac, could that be it? They ran out of money, apparently, which could make it even harder for you to get a mortgage in the future.

  Harder? Is that some kind of cruel joke? How could taking out a mortgage be any more painful than it already is?   Read More...

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• A bailout for bond insurers. How about big banks?

  Posted Jan 29 2008, 02:08 PM by Douglas McIntyre
  Filed under: Banking, Citigroup, Federal Reserve
  Rating:

  The head of insurance regulation in New York is busy as a bee trying to bail out Ambac and MBIA. According to the FT, "Eric Dinallo, the New York state insurance superintendent, is being privately supported by the New York Federal Reserve Bank and other regulators." If the muni bond insurance companies go under it could lead to a new round of fixed income instruments write-offs which would hurt Wall Street balance sheets.

  If the government is going to drag the muni bond insurance companies out of their mess, why not a little help for the likes of Citigroup, Washington Mutual, and Wells Fargo?

  Mr. Dinallo is attempting to get the big U.S. banks to provide the bond insurers with $15 billion in credit to shore up their balance sheets. It is an interesting proposal but it does beg the question of where the cash-strapped banks will get the money. It could be the beginning of a 21st Century version of borrowing from Peter to pay Paul.    Read More...

  Discuss ( 167 comments) 38,362 Views Digg this | Email this | Link to this

• The financial industry: Yeah, it's that bad

  Posted Jan 18 2008, 04:12 PM by Matt Koppenheffer
  Filed under: Merrill Lynch, CAPS, Banking, Citigroup
  Rating:

  Earnings have been pouring out of the financial sector all week and the picture hasn't been pretty. "Write-down" has commanded a starring role in this quarter's earnings reports dashing ahead of "earnings per share" as what investors seem to care about the most.
  
  Citigroup, whose stock just can't seem to find a bottom, seems to have been the worst of the bunch. In an interesting twist, much of the pessimism over the company's quarter came because Citigroup only wrote down some $18 billion and didn't propose as many job cuts as the market was hoping.
  
  CAPS still rates Citigroup just two stars out of five, but there has been some bullish sentiment after the company's earnings release. Michaelkoh1 rated Citi's stock an outperformer and noted that "2007 will be tough, and there will likely be more pain for equity investors as the financials muddle through this year, but this is a strong diversified franchise and will outperform the market over the next 2 to 4 years."   Read More...

  Discuss ( 9 comments) 26,945 Views Digg this | Email this | Link to this

• Citi's Chuck gets a gut check

  Posted Oct 16 2007, 10:57 AM by Matt Koppenheffer
  Filed under: Banking, Citigroup
  Rating:

  When it comes to evaluating companies as investments, analyzing management can be both one of the most important and most difficult undertakings. One way an investor can measure the quality of management is to look at what management says versus what management does.
  
  This is likely what many investors are running through when it comes to Citigroup's CEO Chuck Prince. Despite his stated plans for the bank, Chuck can't seem to make things happen. And to that point, Deutsche Bank's Mike Mayo took him to task on Citi's conference call.
  
  Quoth Mayo: "Well, one of your main targets for this year was to grow revenues faster than expenses and that is not going to pan out. This could be the third year in a row where that doesn't pan out. That was clearly a very important factor."
  
  In other words, "what exactly are you doing Chuck?"   Read More...

  Discuss ( 5 comments) 7,121 Views Digg this | Email this | Link to this