Citi Under $7/Share
A: These are truly crazy times when Citigroup shares trade below $7/share. You mean, having more than 1 trillion in off-balance sheet toxic assets means something? Citi's market cap is now under $40Bln..Hewlett Packard's market cap is now more than 2X that of Citi's!
The gov't simply will not allow Citigroup to fail, but even knowing this it is amazing to see the stock price so distressed. Its not surprising, its just amazing. I mean what would happen if Citi failed? Could we even imagine the effects on the financial system around the globe? The confidence shock? As it looks right now, the stock is headed quickly towards zippo! Is it possible?
Citi already announced major job cuts, and other organizational changes, but clearly the toxic balance sheet + news that the TARP will not be buying distressed mortgage backed securities + no market for these securities + very difficult credit environment + inability to dilute shareholders with stock at $7 + dead investment banking model = bad news for the lowest of the todem pole investors; the shareholders!!
Should the gov't allow GM/F/Chrysler to fail, what will the ramifications be on the issuers of credit default swaps that pay out with such a credit event?
Comments (10)
Triple Top in SKF...
Is that Bullish or Bearish?!?!?!
Posted by morecowbell | November 19, 2008 3:35 PM
I want to be long here, and I have been nibbling for past 3 days. Tough...market is awful and sells into every rally. Like we will be at 700 on S&P in 2 weeks
Posted by Noah | November 19, 2008 3:43 PM
there is blood on the streets right now. Sell pressure is insane
Posted by Noah | November 19, 2008 3:48 PM
But WHAT do you get long?
Posted by morecowbell | November 19, 2008 4:03 PM
Ive been nibbling at index etfs; sso, ddm mainly..when Dow was at like 8300 or so late Monday. I also started nibbling on fcx, dig, and I bought some BAC at 13.25 here before close.
I been holding gold and tbt/pst but from good levels, still in the money on these, although both came down. Tough market
Posted by Noah | November 19, 2008 4:15 PM
Noah - not to call bullshit on you or anything (because I'm sure you've made $ on every trade this year), but how can you be in the money on TBT/PST when they're at all-time lows? Just curious, chief.
I'll confess, I dipped into SSO at 25, took a hit. Net long at this point. For the full year, net worth down 15%, which hurts.
Posted by anon | November 19, 2008 4:56 PM
I have TBT from 56, and PST from 63; 63.40 actually...I apologize for the mistake.
I have gld from mid 60s and accidentally grouped TBT/PST into that trade.
Down 15% is not bad, I know it hurts, but considering its not bad. I gave back about 15% in the past week alone here. Not short anything unfortunately and sold my last ultrashort, eev, around 101 or so. I did watch skf,srs fly fly away!
This market is brutally tough, but the way I trade I usually have very big swings on these fierce selloffs. I have some decent sized longs now, so I could be quickly negative with another 6-7% selloff
Posted by Noah | November 19, 2008 5:38 PM
and NO, I def did not make money on every trade! Luckily, I was short a good amount from like Dow 13,400 or so originally, and made a big chop on the first wave down at end of 2007. So, I took some chances with the gains there.
I made some good calls, and some really bad calls...I also missed out on a few other calls because the trade went against me for while and I didnt wait, like shorting VNO at 108 in SEPT 2007, and watch it go against me. When it did fall, I had only 200s and covered that at 90. Yea, sweet, way to let it ride down Noah!
I am very bad with letting the winners run, as I often take profits way too early; not a bad thing after trading through the dot com bust, but something I just cant seem to fine tune.
Posted by Noah | November 19, 2008 5:48 PM
cowbell/anon - here, is what I have and from what price. I have no issues disclosing. And yes, I am worried that the bottom to this selloff is not likely in yet!
200 DIG - 27.15
200 FCX - 22.90
300 BAC - 13.25, today
300 DRYS - 8.40
400 PST - 63.50, from ways ago
400 TBT - 56.40, from ways ago
500 DDM - 30.30
500 SSO - 24.20
1,600 UYG - 5.80
500 GLD - 65.50, from summer 2007
1,200 DGP - 15.80, flipped this a few times over past year
These are dca positions from nibbling past 3-4 trading days or so. So, you know if I get killed or do ok after today. Hopefully, its ok.
Posted by Noah | November 19, 2008 6:07 PM
oops wait, I lied again. I have 400s of SSO from like 32 in my other account, that I left there. So, 900 SSO from what, like, 28 or so. And I have some puts on GLD, PPS, and calls on FCX which are now worthless.
Posted by Noah | November 19, 2008 6:48 PM