> There seems to be an awful lot of weeping, wailing and gnashing of
> teeth among Wall Street's high command over this "chump change."
Well ... I think it's important not to get too hung up on whether this bit of rough water is because of the writedown or just the last straw in Chuck Prince's inability to lead the (admitedly, huge) ship. I think it's a lot more of the later than the former, though of course anytime you lose $20B (the current $11B plus an earlier $8B) it's a Big Deal. I guess my point is just that it's far less of a Big Deal than has happened to other banks in the past.
Wasn't it Mao who said that if nuclear weapons killed 2M in China they'd still have 998M left? Well, Citigroup's capital is still on the order of $1T ...
There's a good article in Forbes right now that talks about it in a little more detail -- and presents a good case for the stock falling a bit further. But it's pretty clear to me that Citigroup's challenges lie in getting a handle on management far more than it is in raising capital right now.
http://money.cnn.com/2007/11/07/magazines/fortune/eavis_citicapital.fortune/
> But if you see this as a buying opportunity, please feel free to load
> up on Citi shares.
Heh. I'm not going to do that (in fact, I just closed out an options-based short), but I wouldn't doubt it if Citigroup itself loads up on their own shares in the 2-3 quarters-out time period, because they are probably going to get over-slapped for this, and they will see the value eventually.
/jordan