Larry Kudlow of CNBC Reporting of Emergency Federal Reserve Meeting Tonight

CNBC television | 7/23/2002 | Larry Kudlow

[rumrunner]

Larry Kudlow mentioned that the Federal Reserve may be meeting tonight to discuss the exposure of Citibank and JP Morgan Chase to derivatives and the stock market collapse.

Possible that both banks have billions of derivatives that need to be unwound. Would collapse the banking industry.

[crypt2k]

$23.4 trillion ain't chicken feed.

[Political Junkie Too]

I believe the Bush administration has to plant this stuff squarley where it belongs...on the Clinton years, or it WILL come back to bite them.

It would be awfully hard for the media to keep Rubin's name out of the story now, won't it? Especially if he's partly responsible for the potential collapse of the entire banking industry!

-PJ

[Timesink]

Possible that both banks have billions of derivatives that need to be unwound. Would collapse the banking industry.

This will never happen. Both Citibank and Chase fall into the "too big to fail" category. The feds will bail them out 100% if that's what it takes to keep them from going under. Of course, in such a case, everyone at both banks of middle management rank or higher should expect to be fired, and had better find a good attorney and put him on retainer.

[Dog]

Look at how much Citigroup and Morgan have lost...

Investors took fright at the potential damage to the banks from their role in the energy trader's collapse, which has already brought down its auditor Andersen. Citigroup shares fell nearly 16 per cent on Tuesday with JP Morgan down 18 per cent, a combined loss of market value of over $34bn. Citigroup has lost a quarter of its value in two days.

Stunning!

[Torie]

This is a rather hysterical headline. If this was an issue, one would think we would have had some wind of it. Is the fact that these two banks are the ones that have Enron exposure just a coincidence? Maybe Kudlow has his wires crossed and that is the source of the exposure, not "derivatives."

[Dales]

lol A book you have never read still frightens you?

It's a book about this guy who has a slight fall. Unbeknownst to him, the fall injured him enough so that he slowly dies. The book just follows his life as slowly things start to fall apart for him as one thing after another goes wrong with his body.

There are times lately where I just wonder if we are watching something similar happen to us. I hate that pessimistic feeling.

[Endeavor]

Please be gentle here, I rarely even balance my checking account.

My first reaction upon reading your post was that there must be a few greedy people in deal making positions in Morgan and Citibank that made these loans because they'd have to know that these were not only shady, but also that Enron had no real way to pay them back.

But, after I read through the thing, I'm left wondering, given the banks' other money-lending policies,if the whole darn lot of them weren't in cahoots on the whole thing - they were willingly running their companies into the ground solely because of their own personal greed (just like the Enron execs). Is that the correct read?

[Crusader21stCentury]

Agree with the quarter point, anything more would freak out the street.

[Timesink]

$23.4 trillion ain't chicken feed.

Yeah. $23.4 trillion here, $23.4 trillion there ... pretty soon you're talking about real money!

[OldFriend]

Another bailout of his buddies....much as he did when Long Term Capital collapsed. Dirtbags all! Bring on the jail cells.

[crypt2k]

The feds will bail them out 100% if that's what it takes to keep them from going under.

My brother's theory: if you pull out of stocks to avoid a crash watch out for the increased taxes to cover the bailouts.

[Torie]

The source for this appears rather thin. Just who is Jim Puplava?

[Dales]

lol He died. Hence the title.

[OldFriend]

Unless the media figures a way to move Bush and Cheney from being oil men to being bank owners........the dems are going to be damned sorry they wanted to ride this scandal to the mid term elections.

[Timesink]

It would be awfully hard for the media to keep Rubin's name out of the story now, won't it? Especially if he's partly responsible for the potential collapse of the entire banking industry!

Not out of the financial press, no ... but the regular liberal media is quite expert at covering the asses of their favorite, well, asses, until the story becomes literally too big to ignore. Rubin still has some breathing room here, at least for now.

[dalebert]

This should clear the air.

[Michael Barnes]

No doubt..I was watching a bit of CBS and blather was on talking about Worldcom..It was Cousin of Republican (didn't catch the name), and nephew of Ronald Reagan..yada, yada, yada...I stood there awaiting my six pack stunned (why I dunno) that they (CBS and blather) can speak like they are not biased.

You know what's gonna happen, Rubin's ties will be broken on the lamestream across the weekend...dead story by Monday; at least they will try. But I don't think it's gonna work. Too much money is gonna be (already has been?) lost here. Ctigroup has already lost 1/4 of it's value.

[terilyn]

Ping

[Timesink]

Investors took fright at the potential damage to the banks from their role in the energy trader's collapse, which has already brought down its auditor Andersen. Citigroup shares fell nearly 16 per cent on Tuesday with JP Morgan down 18 per cent, a combined loss of market value of over $34bn. Citigroup has lost a quarter of its value in two days.

I would be perfectly happy to see the Federal Reserve, or even the FDIC, take over both banks, chop them into little pieces, and sell them off to a multitude of other banks. As an ex-NYCer, I have had checking accounts with both banks, and can assure you they treat their little customers like absolute crap. I believe they'd both love to get out of serving the "little people" altogether, but are too afraid of the majorly bad PR they'd get from such a move.

They're greedy, they're snobby, they're apparantly acting illegally. I say take them out with extreme prejudice.