Citigroup and Bank of America to be nationalized?

[ChrisFromNJ]

http://latimesblogs.latimes.com/money_co/2009/01/nationalize-b-1.html

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It appears that the shotgun marriages between Wachovia/Citigroup and Bank of America/Merril Lynch have been absymal failures.

[Sam Spade]

Marriages of one drunk with cirrhosis to another drunk with cirrhosis usually don't turn out well.

Why they're interested in a threesome with another drunk with cirrhosis is beyond me...

[Torie]

B of A per the radio apparently needs another 200 billion dollars. This bailout to bad debt holders of these sick banks is simply amazing, and just why the share price should not be zeroed out escapes me.  The main thing that needs to be done is to find an efficient way to dispose of bad assets.  Let the chips fall where they may. Once the bad assets have been cleansed, these bad ass mega banks can begin anew with different shareholders and debt holders, the prior ones having been zeroed out. The new boys on the block just purchase the bank shell with a cleansed balance sheet.

[True Federalist (진정한 연방 주의자)]

It appears that the shotgun marriages between Wachovia/Citigroup and Bank of America/Merril Lynch have been absymal failures.

Especially the Wachovia/Citigroup one, since Wells Fargo swooped in and got Wachovia out from under Citigroup's nose.

[Lief 🗽]

Through all of this, I've been glad that my money is with Wells Fargo, the only bank that doesn't seem to be imploding. Saying that, it'll probably collapse tomorrow morning.

[The Mikado]

*Vomits*

Note: this should not be seen as an endorsement or a condemnation of the possible nationalization, merely a sign of disgust and horror at the present situation.

[Associate Justice PiT]

Wells Fargo, the only bank that doesn't seem to be imploding.

     Don't rub it in my face. I have a huge personal vendetta against Wells Fargo.

[○∙◄☻¥tπ[╪AV┼cVê└]

Just let them fail.

[CARLHAYDEN]

Through all of this, I've been glad that my money is with Wells Fargo, the only bank that doesn't seem to be imploding. Saying that, it'll probably collapse tomorrow morning.

There are a number of other sound banks.

[opebo]

B of A per the radio apparently needs another 200 billion dollars. This bailout to bad debt holders of these sick banks is simply amazing, and just why the share price should not be zeroed out escapes me.  The main thing that needs to be done is to find an efficient way to dispose of bad assets.  Let the chips fall where they may. Once the bad assets have been cleansed, these bad ass mega banks can begin anew with different shareholders and debt holders, the prior ones having been zeroed out. The new boys on the block just purchase the bank shell with a cleansed balance sheet.

Why would their be any 'new boys on the block' in a deflation/depression, Torie?  Economic activity will continue to spiral downward unless the State stops it - for example by printing up money to 'pay for' 'bad debts'.

[Ban my account ffs!]

My money is with a local bank that has had no problems and continues to make auto and house loans.  But yes, Wells Fargo has been one of the smartest, at least for the larger banks, and they will likely come out on top when all is said and done.

[Sam Spade]

Wells Fargo?  In good shape?  lol

Without going too far in making assumptions, I don't think we can be sure that any of the large banks are solvent.  Surely some of them are, for now, but we have no clue.  And we can certainly not bet on their future solvency.

As for the regional/local banks, you have to pick and choose.  I would not trust the future solvency (though they may be presently solvent) of any bank that is significantly leveraged in commercial real estate, just FYI.

[© tweed]

Citigroup is splitting into two

http://news.bbc.co.uk/2/hi/business/7833090.stm

[Fmr. Pres. Duke]

Well, buying CITI stock at $15 a few months ago was pretty stupid, in retrospect.

[The Mikado]

Just let them fail.

Have I ever told you guys that I don't really care for our definition of populist as "socially conservative, economically left?"

To me, populism more focuses on demagoguery and simple, counterproductive solutions to intricate problems that revolve around "sticking it to the Man."  Those can come from any angle of the political spectrum.

[ChrisFromNJ]

Just let them fail.

Have I ever told you guys that I don't really care for our definition of populist as "socially conservative, economically left?"

To me, populism more focuses on demagoguery and simple, counterproductive solutions to intricate problems that revolve around "sticking it to the Man."  Those can come from any angle of the political spectrum.

Well said!

[Psychic Octopus]

stop the madness!!!!

[MaxQue]

Put your money in cooperatives, not in banks, like half of Quebecois did.

[Southern Senator North Carolina Yankee]

Just let them fail.

Have I ever told you guys that I don't really care for our definition of populist as "socially conservative, economically left?"

To me, populism more focuses on demagoguery and simple, counterproductive solutions to intricate problems that revolve around "sticking it to the Man."  Those can come from any angle of the political spectrum.

Why do you think I can't stand populism? Just for that very reason.

[Sam Spade]

I agree with fernie.

But considering most banks are probably insolvent or will soon be, the government should, before letting the insolvent banks fail, 1) examine the books of each bank so that it knows which banks are ok (i.e. which banks to back up) AND 2) if very few large banks are solvent (probable), capitalize new banks with the remaining TARP money, which can, after a while, be sold off to private investors.

Oh, and reinstitute Glass-Steagall.  And prepare stringent reporting regulations for the derivatives market or make the derivatives market illegal (whichever).