Jimmy Lathrop

Earnings Season: Fundamentally Flawed

User 219640

I am sure this site would publish an article on pets.com resurgence if it was well written and could state some accurate and coherent arguments towards advancing that opinion. In the absence of intelligent opinions towards that scenario, is it right to declare that SA is now bearish?

It is not just a bunch of anonymous SA posters calling for the breakup of Citibank. You can pick up any financial newspaper and find experienced industry money managers and analysts stating that the retail section and the investment section should be split.

Sandy Weill had a dream to merge Travellers into Citigroup. He rammed a bill through Congress which repealed Glass-Steagall which had worked for many years and didn't need tinkering. He then set himself to the task of overthrowing the Citibank management, and installing his own board of cronies, including his cocaine addicted son who would fall asleep at briefings after all night binges. Citibank embarked on a voracious pattern of growth through acquisition, centering around an integrated market model of cross pollination of insurance, retail banking, mortgage lending, credit card lending and investment brokerage.

Meanwhile, what has all the work resulted in? If you are a Smith Barney customer, as I am, their business model is years behind the discount brokerages which involve better selection of securities, less fees, less selling of crummy products and better online platforms to trade and research. The credit cards are experiencing the pinch of the economy. The uptick in business on the insurance side is brought down from the costs of consolidation. Even Starbucks knows when it is time to close stores but Citibank refuses to address the possibility of downsizing. There is no silver bullet which will slay the werewolf at the bank's vault.

During all the turmoil of Citigroup stock, have you noticed a conspicuous absence of comments from the founder of the megabank? I wonder where Sandy Weill is these days? Oh that's right, he's counting your money and laughing on his yacht.