Meredith Whitney Bloomberg 11/26/08 - Citigroup C

Meredith Whitney of Oppenheimer was on Bloomberg today, 11/26/08, and she had comments on Citigroup ( C ) and the current financial crisis. Meredith Whitney warned people in August before this whole downturn, so I always find what she has to say interesting. She called this financial crisis before anyone over a year ago and she has even received death threats, but she has been right! On November 5th, 2008 - Meredith boldly came on CNBC's closing bell and told viewers there were still major problems with Citi and other financial stocks, predicting C stock would fall into the single digits. Citigroup was trading at $13.50 at that point. Friday, Citi stock sunk under $4 per share.

Meredith Whitney Comments - November 26, 2008 - Bloomberg

Citigroup ( C ) Bailout

Have we seen the Bottom for Citigroup? Its hard to say if the Fed's move will stop the slide of Citigroup stock. The cost of Citi's debt capital has soared.....the issue with the monies is that it just goes to plug holes....they look great this week, but by the fourth quarter they will look worse.

Banks are hoarding cash, consumers are hoarding cash, capital demands are changing and increasing on a daily basis. Assets are going to get cheaper from here on out, people aren't ready to catch a falling knife yet.

TARP 3.0 - Terms of the Tarp 3.0 deal were so beneficial to Citi, every single financial company has toxic assets and are carrying them at big levels. Some banks are reluctant to admit they need more capital....most banks are carrying bad assets just like Citigroup. Nothing will improve as long as there is asset deflation. It may take as many as five years to turn financials around.

To blame Vikram Pandit and not blame the board of directors is a bad call....Vikram Pandit was dealt a very bad hand when he came to Citigroup.

Earnings Growth - The Capital the banks are raising right now is going to plug holes, we will look back in a year and say, wow, those balance sheets were worse then we thought.



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