CapNgain

Citigroup's Decline - Not a Good Sign for the Market

You'd probably be right if it wasn't for the CDS contracts. Would nationalization trigger a default provision, causing tons of other zombie banks to pay out cash they may not have? I'm no CDS expert, but I wonder if it isn't this complex web of derivatives forcing the US to follow the Japanese blunder of supporting zombie banks at the expense of a decade or so of economic growth - simply to avoid further destabilization of other internationl banks?


On Mar 01 12:28 PM Ricard wrote:

> If C were to be nationalized, it may end up being a plus. Given
> its current state and the media attention it is receiving, no financier
> of high repute would ever want to work in this firm. It, and others
> like it, needs to be dissolved, or sold in parts to the highest bidder.
> Only then would our financial system begin a recovery.
>

Citigroup's Decline - Not a Good Sign for the Market

I can't believe how many people seem to believe the BS about the uptick rule, and mark to market.

Has it occurred to anyone that perhaps these stocks are getting hammered because their fundamentals are lousy, and they're losing more money than the company is worth? Sure, the uptick rule can result in larger short term hourly fluctuations, but at the end of the day it seems to me earnings, cash flow, etc. matter far more than short interest (if short sellers unfairly drive down the price of a stock, the smart money moves in and buys value).

And, w.r.t. any mark-to-market whiners, it would be great if you could lend me money to purchase stocks with up to 50% margin. If the value of my holdings declined, and you gave me a margin call, I'd love to have a lender that I could convince to rescind the margin call based on convincing them the non-mark to market value of these stocks 5-10 years later would likely be far more than the margin amount owing today.