Citi (NYSE: C) Bites The Hands That Feed It

By: Ron Rowland Friday, July 03, 2009 8:30 AM

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People on Fox News Channel and other conservative outlets charge that the government is taking control of private business. Those saying this should know better. The reality is quite the opposite: private businesses, and specifically a few large banks, have taken control of the government.

Worse, the bankers are using their control of the political system to line their own pockets while extracting cash from the very people who recently saved their bacon. The looting that is now underway makes New Orleans after Katrina pale in comparison. Consider Citigroup, ticker symbol C. Citi is, you will recall, a bank that continues to exist only because both Bush and Obama administrations granted it billions in emergency financing on laughably favorable terms.

We, the American taxpayers, now own approximately one-third of Citigroup. Call it socialism if you wish, but logic suggests that as owners we might get a break from those who owe their continued income to our generosity. No such luck. In fact, if you have a Citi credit card, the bank is spitting in your face by raising your interest rate.

What is Citi doing with this extra cash flow? Increasing salaries for top executives by up to 50%, of course. Never mind that these same people would be earning salaries of ZERO if the rest of us had not bailed their firm out of its insanely stupid risks.

Wait, you may say. These are talented people. They deserve to be well-paid, and the bank has to protect itself from credit risk. True enough, except that this is a bank that is still issuing no-doc, no appraisal mortgages more than a year after the housing market began to crash. Why should such monumental incompetence be rewarded?

Meanwhile, those not lucky enough to be employed by Citigroup are facing stagnant wages, if they are making any wages at all. The official unemployment rate is now 9.5%, and more than 16% by some measures. The average work week stands at 33 hours, the lowest since 1964, as employers try to avoid layoffs by reducing overtime and imposing furloughs. All the while, Citigroup execs have been transferring money from your pocket to theirs. The IRS, Treasury, and Federal Reserve merely serve as intermediaries.

So the question remains: who is controlling who? The idea that the federal government is somehow oppressing banks like Citi is insane. You, the taxpayers, are the ones being oppressed here. The fact that the top executives and directors of Citi still have their jobs after all that has happened tells you everything you need to know.

The reality is this: heads the bankers win, tails the taxpayers lose. It’s been going on for a long, long time and is not going to stop anytime soon. Happy Fourth of July.

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7/3/2009 10:08:12 AM dopey c shareholder by ali The out of control situation at C is worse than most people understand. ALL staff will benefit from a general base salary increase. This is being done to avoid a class action by units/departments that were originally excluded from the pay hike. Now just think about it for a moment. A bonus was generally given for a "above and beyond" performance" that could be quanified by say, sales level, revenue, loss prevention, market share, customer satisfaction, etc. At least, under this approach, one had to earn it. Instead now it becomes part of your paycheck just for showing up to work. THERE IS NO HOPE FOR CITI, THE MORONS OF PARSONS & PANDIT ARE CHARGE AND WILL NOT STOP UNTIL THE COMMON SHARE IS BACK DOWN TO $1 !!!!!!!!!!! Reply Rating: (5) (3)
7/4/2009 7:18:02 AM USA Citizen by Martin In helping the financial system, we the taxpayer, were also helping our system, Capitalism and Democracy. We are now in a deep recession. Blame whatever caused it, the housing bubble or the excessive mortgate lending or people who bought houses without being asked to put down enough of their own capital, call what caused it what you want, the recession is here. It is up to Government to help jump start the economy and then step away and let "the capital system fix itself." 1) A Company is as good as its Brain Power. If you do not pay the best brain power, it will go to the Company that will pay them the best, perhaps a "foreing banking company." 2) If America, in the name of the taxpayer, puts lids on the brain power people just because they helped them out (and by the way, we did not help out our financial system to help Wall Street, we helped out our financial system because it is the life blood of Capitalism, and if the blood were not there, the Country would have fallen into the deepest "DEPRESSION" the World could imagine. What the "terrorist" could not do to us, we would have done to ourselves." Reply Rating: (1) (1)

The out of control situation at C is worse than most people understand. ALL staff will benefit from a general base salary increase. This is being done to avoid a class action by units/departments that were originally excluded from the pay hike.
Now just think about it for a moment. A bonus was generally given for a "above and beyond" performance" that could be quanified by say, sales level, revenue, loss prevention, market share, customer satisfaction, etc.
At least, under this approach, one had to earn it. Instead now it becomes part of your paycheck just for showing up to work.
THERE IS NO HOPE FOR CITI, THE MORONS OF PARSONS & PANDIT ARE CHARGE AND WILL NOT STOP UNTIL THE COMMON SHARE IS BACK DOWN TO $1 !!!!!!!!!!!

Rating: (5) (3)

7/4/2009 7:18:02 AM

USA Citizen by Martin

In helping the financial system, we the taxpayer, were also helping our system, Capitalism and Democracy.

We are now in a deep recession. Blame whatever caused it, the housing bubble or the excessive mortgate lending or people who bought houses without being asked to put down enough of their own capital, call what caused it what you want, the recession is here.

It is up to Government to help jump start the economy and then step away and let "the capital system fix itself."

1) A Company is as good as its Brain Power. If you do not pay the best brain power, it will go to the Company that will pay them the best, perhaps a "foreing banking company."
2) If America, in the name of the taxpayer, puts lids on the brain power people just because they helped them out (and by the way, we did not help out our financial system to help Wall Street, we helped out our financial system because it is the life blood of Capitalism, and if the blood were not there, the Country would have fallen into the deepest "DEPRESSION" the World could imagine. What the "terrorist" could not do to us, we would have done to ourselves."

Rating: (1) (1)

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