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This is unbelievable. Some of these bank bailouts have been bad, but this is criminally negligent:
- Citi will carve out $300-billion in troubled assets, which will remain on its balance sheet
- The first $37-$40-billion in losses on those assets will go to Citi
- The next $5-billion in losses will hit Treasury
- The next $10-billion in losses will go to the FDIC
- Any more losses will go to the Fed
- There will be no management changes at Citi, because, you know, they are all fine and upstanding people who have done nothing wrong
- There will be some compensation limitations, but those have not yet been made clear
To some it up — you pay, while some Citi executive enjoys his summer in the Hamptons.
a lousy deal for the taxpayers, no accountability for management, and just to make things perfect, quite possibly inadequate, so that Citi will be back for more.
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more from bernhard: Rubin’s Citigroup Bailout
Yesterday’s NYT article, Citigroup Saw No Red Flags Even as It Made Bolder Bets is a must read.
My emphasis.
That Obama has made Rubin an economic team transition adviser is very disturbing.
I really think that financial institutions are trying to grab their brass ring “few or no string attached” bailouts before Bush leaves office.
It ain’t right.