Citi in death watch -- Lehman again

The Asian markets are open and no word on a rescue plan for crashing Citi. Exactly the same scenario as Lehman. No government, no investors. Amazing inaction again in a moment of crisis.

The Asian markets are open and no word on a rescue plan for crashing Citi.  Exactly the same scenario as Lehman.  No government, no investors.  Amazing inaction again in a moment of crisis. 

It is hard to believe, but given all the politics involved, it is more than likely that the government will sit on the sidelines and let Citi implode.  The clearest sign is that no action has been taken before the Asian markets opened. 

The auto industry spooked a response and tied the hands of cooler heads. 

If Citi is allowed to go down tomorrow we will have one of the worst days yet (if anyone can imagine a still worse day), and it will be followed by real runs on the bank and the fall of many more banks in the next few days.  

Reviews

  • Sam Cass

    November 24, 2008

    The government will not allow Citi to fail for now. Officials are working on a plan. But Citi has pretty massive exposure in the US and especially abroad. With international markets turning down, the pressure is only going to increase on them. The question is at what point does a bank become to big to fail, but also be to big and expensive to bail out?

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