Holy cow Citi closed at 2.51 down yet ANOTHER 13% today and BAC 3.93

[TwixVoy]

Seeing these two major banks drop like a rock like this is incredible. One share of Citi is $2.51. Bank of America $3.93.

Basically this means these two banks are completely insolvent and the market knows it. The damn sad thing is the amount of assets these two have their hands in. If EITHER of them were relatively isolated in to one sector like WAMU they would already have been taken over by the feds. I suspect the feds want to take them over, but they are scared as hell over what the consequences could be.

[DS1]

1. Wow, that BAC is one hell of a good time!

/rimshot


btw, I closed my accounts with BAC yesterday. The fees they'd charged me were the final straw.

[LakeSamish706]

2. What would the consequences be if they took them over? n/t

[TwixVoy]

4. Damned if I know

but they have their hands in virtually EVERYTHING. They were a "one stop" banking solution. They offer credit cards, savings/checking, mortgages, car loans, personal loans, wealth management accounts (for the ultra rich), lines of credit, brokerage services, insurance, damn near every financial service you can think of AND they do it globally. The fact they are technically insolvent means them going down would impact financial markets world wide. They have so many TRILLIONS of dollars they impact every day no one could even begin to calculate what a Citi failure would do.

[CatholicEdHead]

3. I guess when having a 13% drop in your stock, having getting a 3.93 BAC with Happy Hour helps

;)

[Oceansaway]

5. Wells Fargo aint doing so well either....n/t

[TwixVoy]

6. I think Wells Fargo will be fine

Reason being the feds got them to take over Wachovia. The feds would NOT have given Wells Fargo a failing bank if they thought Wells Fargo themselves would fail.

Also wells fargo has been pretty damned conservative even when other banks were handing out credit like candy. Generally when you get a loan with wells fargo they want to see that you have the cash coming in to back it up.

[SoCalNative]

7. I think it's time to get my Dad to pull his money out of B of A

and open an acct with my credit union...

[DJ13]

8. Maybe the traders see them as acting desperate when they raised CC rates?

[TwixVoy]

9. That is no doubt part of it

Raising rates is a means to collect more cash when they are desperately out of it.

I am reminded of WAMU attempting to get people to open CDs like crazy in their last days. It was a last desperate attempt to get capital to prevent from going under. I am also reminded of the WAMU CEO putting up a letter on the main page of WAMU.COM telling everyone that everything was fine just days before the feds took them over.

[Still Sensible]

10. Does the value of their assets exceed their

market cap?

[Mike 03]

11. Amazing, ain't it? And people here are still asking what good the TARP and stimulus packages are.

We are walking the edge of the razor blade, for sure.

[Mike 03]

12. Kick and Rec.

Your post is an important post.

[Numba6]

13. It's called a CAPITASL STRIKE & they'll do it until we back semis loaded w/ cash to the

trade floor & start throwing bales of it down to the day traders, like Santelli-the-ass

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=132x8211218

THe last 8 years of giveaways aren't enough, they're demanding more

[Tatiana]

14. OK, when will the public opinion be great enough for us to nationalize them?

Clearly they are pretty much or nearly insolvent. And additional government bailout cash will only amount to throwing good after bad.

[TwixVoy]

17. Too little too late

the time to nationalize them was 8 years ago. Right now what you suggests would be like changing the captain of the titanic after it hit the ice berg. Sure it might have smarter leadership now that would avoid ice bergs, but the ship is still going down.

[wuvuj]

15. The banks are leading this selloff...

...same as in early Jan. Guess when they announced the stress test investors decided they didn't want to own banks....and they wonder why there were no details?

[Skidmore]

16. Citi hold our mortgage.

I keep sending in the payments. My little pebble falls into the ocean.

[11 Bravo]

18. Mine as well. Never missed a payment in 19 years.

Apparently it didn't matter.