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Sunday, July 19, 2009
7:09 PM TweetThis
  • At least some one had the good sense to bail out CIT Group (CIT): The administration "took a tremendous risk by allowing CIT to head toward the door. It is lucky that CIT had one last chance to stay alive. The economic recovery might not have survived its demise."
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This news story has 15 comments:

  •  
    The news so far about this deal has been very light on detail, except that CIT is going to pay LIBOR +10 for some bridge financing and that there will be debt swapped for equity.

    This might just be the bondholders giving it their best shot to help CIT sell the FDIC a wooden nickel.

    I don't know if Sheila will go for that.
    Jul 19 07:55 PM | Link | Reply
  •  
    does anyone really believe the present set of hands -on administrators would let CIT go down? c'mon get real, the 'other party' was told to back them and that they would be backstopped , no matter what. get with the program, comrades.
    Jul 19 08:01 PM | Link | Reply
  •  
    Oh come on!!!The fate of Western Civilization rests on CIT??? Ya right. Like the modified loan program for underwater homeowners, extending more credit to a bankrupt on the steps of the bankrupcy court will NOT save them. Throwing good money after bad.
    Jul 19 08:04 PM | Link | Reply
  •  
    It looks like a temporary reprieve...they are not out of the woods yet...far from it...
    Jul 19 09:02 PM | Link | Reply
  •  
    From finance.yahoo.com Message Board: CITI Common shareholders are raising their sell prices to $5.00 or beyond with their brokers to prevent them from shorting their shares! A revolution is afoot!!
    Jul 19 09:14 PM | Link | Reply
  •  
    They were facing bankruptcy becuase they made tons of bad loans to small businesses that now can't pay them back.

    Allowing those same bad judges of risk to keep borrowing and lending is just giving them license to lose even more money.

    They should be shut down NOW.
    Jul 19 09:16 PM | Link | Reply
  •  
    "It became necessary to destroy the village in order to save it."
    -- An American major after the destruction of the Vietnamese Village Ben Tre
    “Now, people when I say that look at me and say, ‘What are you talking about, Joe? You’re telling me we have to go spend money to keep from going bankrupt?...The answer is yes, that's what I’m telling you."
    -- Joe Biden
    " The horror, the horror."
    -- Col. Kurtz
    Jul 19 09:20 PM | Link | Reply
  •  
    Nothing fails in America eh?
    Jul 19 09:37 PM | Link | Reply
  •  
    Good judgement by decision-makers?

    HardToLove


    On Jul 19 09:37 PM tunaman4u2 wrote:

    > Nothing fails in America eh?
    Jul 19 10:18 PM | Link | Reply
  •  
    "The Administration has not given any reason for its decision not to aid CIT and not to act as an aggressive broker to find a buyer for the firm"

    This is part of the current problem-- people turning to government and asking "What are you going to do about this ?"

    The government was, for a change, correct to not bail out another company. However, the problem they have created is that many are now asking "Why?" , or are suspicious that there was a hidden motive favoring someone politically connected. In the end, when government is in bed with business, a cesspool of corruption starts to form all around. Even if everything is above board, all are suspicious of whose wheels got greased.

    In this case, as 24/7wallst points out, "CIT’s bondholders acted in their own interest when they stepped in to salvage CIT. They might have lost much of their investment if the company went into Chapter 11 or an outright liquidation. "

    Exactly. Investors acted in their own self-interest. The world didn't end.
    Jul 19 10:31 PM | Link | Reply
  •  
    CIT needs to fail; we have become nothing more than a welfare state, pathetic.


    On Jul 19 09:16 PM Paul Price wrote:

    > They were facing bankruptcy becuase they made tons of bad loans to
    > small businesses that now can't pay them back.
    >
    > Allowing those same bad judges of risk to keep borrowing and lending
    > is just giving them license to lose even more money.
    >
    > They should be shut down NOW.
    Jul 19 11:02 PM | Link | Reply
  •  
    I'm waiting on some lard-headed wingnut to blame the demise of CIT on Barney Frank.
    Jul 19 11:21 PM | Link | Reply
  •  
    Glad the govt stayed out. The systemic risk phase is long gone. If private capital wants to bail them out, so be otherwise let the regional banks and such take their prime business away. Love how everybody talks about how they are needed for the retail sector. Really? The sector where we have too much competition. Let the strong survive and get rid of the weaklings.
    Jul 20 12:02 AM | Link | Reply
  •  
    “Now, people when I say that look at me and say, ‘What are you talking about, Joe? You’re telling me we have to go spend money to keep from going bankrupt?...The answer is yes, that's what I’m telling you."
    And he is exactly right but its a little complicated for the Idiocracy.
    Jul 20 01:38 AM | Link | Reply
  •  
    I'll take the bait.


    On Jul 19 11:21 PM shrike wrote:

    > I'm waiting on some lard-headed wingnut to blame the demise of CIT
    > on Barney Frank.
    Jul 20 08:39 AM | Link | Reply
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