Posted on 02/27/2009 5:43:05 AM PST by rabscuttle385
BY KEVIN KINGSBURY AND MAYA JACKSON RANDALL
Struggling banking giant Citigroup Inc., moving aggressively to shore up its equity base, announced a stock swap Friday that if successful will leave the government owning more than a third of the company and wipe out nearly three-quarters of existing shareholders' stake.
The move is an acknowledgment that more than $50 billion in government capital and a backstop on more than $300 billion in troubled Citigroup assets haven't been enough to stop the bank's slide. It also represents a deepening of the government's role in trying to prop up the U.S. banking sector.
Under the deal, Citigroup said it will offer to convert nearly $27.5 billion in preferred stock sold to private investors and the public and up to $25 billion in preferred stock bought by the government into common stock. The exchange, if fully executed, would leave the U.S. government with 36% of the bank's shares. Existing shareholders' stake would be cut to 26%. Shareholders will have to approve much of the common stock issuance.
Additionally, the government is demanding that the company overhaul its board of directors. Citigroup's board will soon include a majority of new independent directors, the company said Friday. Chief Executive Vikram Pandit is expected to keep his job under the agreement.
The bank's stock plunged on the news.
(Excerpt) Read more at online.wsj.com ...
If we cannot save Citigroup by any other means than these, then let it go. This solution is far worse than the problem, and the problem is a massive one.
I swore Citi off in the 90’s because I didn’t think they were competent to operate a manure farm. And here they are, sh!tting all over the country.
Why not just let it go under?
You thought they were incompent then? Just wait till the government takes over.
However did the GOP get so corrupted as to be a passive observer of evil perpetrated against the people over the past decade or more?
According to Websters dictionary (before it went politically correct), the definition of Communism was :
"When government takes control of private businesses and industries."
The left has exceeded Socialism. They're going even farther than that.
According to the same dictionary, Socialism is:
"The prelude to Communism."
Mussolini or Hugo Chavez anyone?
Fascism
A system of government marked by centralization of authority under a dictator, stringent socioeconomic controls, suppression of the opposition through terror and censorship, and typically a policy of belligerent nationalism and racism.
Economic Fascism
by Thomas J. DiLorenzo
When most people hear the word “fascism” they naturally think of its ugly racism and anti-Semitism as practiced by the totalitarian regimes of Mussolini and Hitler. But there was also an economic policy component of fascism, known in Europe during the 1920s and ‘30s as “corporatism,” that was an essential ingredient of economic totalitarianism as practiced by Mussolini and Hitler. So- called corporatism was adopted in Italy and Germany during the 1930s and was held up as a “model” by quite a few intellectuals and policy makers in the United States and Europe. A version of economic fascism was in fact adopted in the United States in the 1930s and survives to this day. In the United States these policies were not called “fascism” but “planned capitalism.” The word fascism may no longer be politically acceptable, but its synonym “industrial policy” is as popular as ever......
snip
Government-business partnerships. A (third) defining characteristic of economic fascism is that private property and business ownership are permitted, but are in reality controlled by government through a business-government “partnership.” As Ayn Rand often noted, however, in such a partnership government is always the senior or dominating “partner.”....
http://www.banned-books.com/truth-seeker/1994archive/121_3/ts213l.html
Unless they own half, I think we can’t “technically” be considered nationalized. The govt. owns stocks in plenty of things and isn’t nationalized. However, this is pretty darn close......SCARY.
check out fascism, not communism-
No problem. Big government with its nationalized banks will save you.
Isn't this unconstitutional, under the due compensation clause?
Have I mentioned how much I despise Obama today?
Something else is happening in the world, too. The churches around the world (except the left wing apostates) are pointing fingers at Oboma and his "Messiah" message. Even the Pope politely warned the people not to worship Oboma.
People would never expect an African American to be the man of sin. The anti-Christ is suppose to have Italian blood, but Obomas birth name really IS Italian - Barry Soetoro.
[Obama is a 1st class liar.]
Yep, and the media is more than willing to provide him cover.
Obama is a 1st class liar.
_______________________________________
He’s a communist. That’s how they work.
One
Big-
Assed
Mistake
America
(No, I can’t take credit for making it up)
7044 now.
Citi has my mortgage. Maybe they won’t make me pay it anymore.
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