Angry Banker

Citigroup Should Walk Away from Wachovia

Folks, there is a misunderstanding about FDIC backed deal with Citi and the impact it has on taxpayers. The FDIC is a private institution that receives no government financial support. It is 100% funded by financial institutions. Therefore, the Citi deal with Wachovia will not cost taxpayers anything unless the merged entity receives assistance from the new $700 billion bailout package passed by Congress this week (but that assistance is available to the firms regardless of whether Citi or Wells Fargo buys Wachovia). In fact, the only reason that Wells Fargo has illegally come back and offered another deal to Wachovia is because of the $700 billion bailout package that passed this week. If that bill had not been passed, Wells Fargo would not be interested in Wachovia.