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« The Daily Bail Makes The Show | Main | Barney Frank And Mark Haines Battle Over Wall Street Pay »
Friday
Jun122009

Citigroup Sells $1 Billion Of Paper Without An FDIC Assist (Video)

It was miracle Wednesday in the disturbing land of soylent green shoots.  What the hell am I talking about?  Citigroup managed to sell $1 billion in commercial paper without an FDIC backing after the close yesterday.  But, there's that pesky coupon @8.25%, about 4.5% above Treasuries.  That's not cheap money, and it demonstrates that risk taking and certifiable insanity are closely related.  Citigroup paper can be found at your local supermarket in absorbent rolls of 8 or 16.

 

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Reader Comments (16)

Hey AB. This one's for you.

Mortgage guidelines have become increasingly strict -- not to mention regimented -- as the private secondary-mortgage market has all but disappeared in the past 24 months. But according to the Wall Street Journal, appraisals are increasingly becoming one of the biggest hurdles for new purchase and refinance transactions.

http://www.minyanville.com/articles/jpm-fre-fnm-mortgage-banks-lender/index/a/22994?ref=patrick.net
Jun 12, 2009 at 5:54 AM | Registered CommenterDailyBail
Jun 12, 2009 at 6:28 AM | Registered CommenterDailyBail
Jun 12, 2009 at 6:31 AM | Registered CommenterDailyBail
Jun 12, 2009 at 6:31 AM | Registered CommenterDailyBail
America’s Sea of Red Ink Was Years in the Making

http://www.nytimes.com/2009/06/10/business/economy/10leonhardt.html?em
Jun 12, 2009 at 6:33 AM | Registered CommenterDailyBail
Foreclosures are the solution not the problem if we really want to get to a bottom in housing,

http://mortgage.freedomblogging.com/2009/06/10/economists-disparage-foreclosure-relief/11781/?ref=dailybail.com
Jun 12, 2009 at 6:40 AM | Registered CommenterDailyBail
Find out who owns your mortgage

http://www.cnbc.com/id/31207397?ref=dailybail.com
Jun 12, 2009 at 6:42 AM | Registered CommenterDailyBail
Jun 12, 2009 at 6:45 AM | Registered CommenterDailyBail
DB.....In the face of ALL the above in the mortgage related world....How would you feel if an agreement between an "aspiring up and coming politician" Andrew Cuomo and a now DEFUNCT Fannie & Freddie caused ALL your clients to disappear and your only conduit of business become working for a middle man who takes HALF of your FEE? Yeah, thats right, the appraisals consumers order are being channeled through clearing houses called AMC's or Appraisal Management Companies. These companies do all the ordering and quality control. I jest because the quality control HAS to be SEVERE because what competent or qualified appraiser can continue to work for 1/2 the fee? Sounds like a complaint but does America know appraisers minimum cost to do business is over $20,000....BEFORE the first order comes in? The fees are so low that an appraiser evaluating you largest asset (house) are being paid on average $8-10 bucks an hour. Google the HVCC. Sounds good in theory but is KILLING this industry. I am having to find other means to make a living. Do you know the cost for an appraisal has actually GONE UP? Yes, the borrower pays the bank $350-450 for the appraisal while the man doing the job gets $150-200. Where is the rest of the money going? The HUD1 or Good Faith Statement does NOT express that the bank may be keeping a portion of that payment OR that a Third Party is getting a portion of that fee. I know MOST CONSUMERS have no clue who or what is going on when they pay for an appraisal. They think that money goes to the appraiser. I get that EVERY TIME I do one. The consumer feels and IS getting RIPPED OFF. Sorry to go on but the public need to be educated because the main stream media has not run ONE story on this. Yes there were BAD appraisers but the BANKS SOUGHT OUT those because HONEST APPRAISERS would have KILLED 90% of the fraudulent loans. Got to give us a 10% margin of error because we are human. Those scum bags are gone and the honest guys/gals are stuck with a bad rap and are now being punished. It's NOT politically correct to defend ANYONE related to the housing industry. I tell you there are God's children SUFFERING in this.............
Jun 12, 2009 at 8:43 AM | Unregistered CommenterAin't Bullshittin'
I feel your pain, AB. I knew you would not be happy to read it. We really need to get a journal entry post up from you about the appraisal business. You know it better than anybody around here.

So others can see why you are upset, here is the link again.

http://www.minyanville.com/articles/jpm-fre-fnm-mortgage-banks-lender/index/a/22994?ref=patrick.net
Jun 12, 2009 at 9:01 AM | Registered CommenterDailyBail
I have stories I could tell about how these companies work. Do you know a LOT of the previously employed Sub Prime Mortgage Brokers now have STARTED their very own AMC's? Yep, the biggest crooks on the planet now handling the firewall between fraudulent and honest work. How is that for IRONY? I see the lenders doing things TODAY that HORRIBLE brokers would NEVER have thought of...even back when it was the Wild West show from 2001-2007. I have been in the trenches for a while and it hurts me to see the greed I fought against KILLING our economy. Honest appraisers barely feel this downturn because we have been going BROKE for quite a numbers of years. I stayed because I truly believed goodness and honesty would be rewarded and allowing the cream to rise to the top. I mean qualified and accurate appraisers being paid more for their integrity and knowledge. People think this is easy because they see us for 15-20 minutes with a tape measure. They DON'T see the hours of data analysis and the time it takes on the job to pinpoint market reaction to features and the ability to support adjustments. Who says that custom kitchen is worth $50,000? The market data may tell you that it's worth something but probably NOT the $50,000 you paid for Home Depot to put it in 3 years ago. Thanks for your concern on this issue. America should really fear the loss of true professionals that evaluate their biggest asset. Would you want a Wal Mart Greeter handling your retirement account? Why then is it OK to pay Wal Mart wages to your appraiser?
Jun 12, 2009 at 9:41 AM | Unregistered CommenterAin't Bullshittin'
If you're an investor looking for a Treasury security that pays an 8% coupon, why not buy one from Shiti? And even if you're not 100% sure about that implicit govt guarantee for your "Citi" bond, just buy it anyway. It's a win-win, either way. Either you get the 8% no-risk return, or all the other bondholders get whacked and you know you'd pay good money to see THAT happen.

Better yet, borrow the money to buy the bonds. Call it a Bailout Arbitrage play. If you're Goldman Sachs, say, and Uncle Ben is just giving you free money, why not put up some shitty collateral and buy some Shiti debt? In fact, get all your friends to do it, leverage up on that stuff 30-1 and then you're probably all "systemic." These are salad days indeed, if you're a bankster.
Jun 12, 2009 at 11:25 AM | Unregistered CommenterJames H
James H got it right.

The buyers were probably all decided in advance, wise guys using leveraged money, which perhaps came, by one route or another, out of another TARP bank or Citi itself or one of the Wall Street welfare queens.

Sure glad the Treasury keeps outsmarting those money people...
Jun 12, 2009 at 4:22 PM | Unregistered CommenterK
Good Lord, this country is going to HELL in a handbasket. The only good thing for me is that I am almost at the end of my string. But I sure do pity my grand and great grandchildren, and I have six of each.
Apr 10, 2010 at 3:27 PM | Unregistered CommenterJim B.
we all worry about the next generations jim...at least those who understand what the hell is going on...
Apr 10, 2010 at 9:05 PM | Registered CommenterDailyBail

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