wpe50.jpg (1913 bytes)     TigerSoft News Service    11/23/2008      www.tigersoft.com 


                    A New $20 Billion Bailout for CityGroup.

                   MANIPULATION OF CONGRESS?

                                          Look at their one-day gains on 11/24/2008 after the latest handout.
Goldman Sachs +26.5%
                                                          Citygroup +57.8%
                                                          Bank of America +27.2%
                                                          JPMorgan +21.4%

                         PAULSON LEARNS NOTHING FROM

Again No Requirement That The Bank Make Loans
                                   Again The Goverment Does Not Get Even A Seat on Board of Directors.
                                  Again The Government Gets Non-Voting Preferred Stock
                                  Again No Transparency!
                                  Again No Protection That These Bankers Will NOT Make The Same Mistakes again.
                                  Again No Discussion of The Need To Break Up This Unmanageable Giant

           Again Unbridled Greed Is Rewarded

The Last Bailout Did Not Help.  Why Should This One?
                   If The Banks Refuse To Make Loans until Government Buys
                   All Their Toxic, Non-Performing Loans, Then Start A Real
                   Government Bank To Make Loans!

                   CitiGroup Needs To Be Broken Up.  It's Too Big (period).

                                    by William Schmidt, Ph.D.
              Author of Peerless Stock Market Timing: Automatic Buys and Sells: 1915-2008    
                        TigerSoft's Accumution Index, Opening/Closing Power   
Finding The Most Bearish Stocks
                                     Studies of Insider Trading       Best Ways To Trade Stocks

                                                            Spoting Banks in Big Trouble
TigerSoft News Service - 9/26/2008 - TigerSoft Warned Investors ...
wpe4F.jpg (33251 bytes)  

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-                        TigerSoft 2006-2008 Charts of City-Group  - See Blog 11/15/2008
                      See the heavy red distribution and Sells  that warned of very significant insider selling.
                      This indicator was invented by TigerSoft in 1981.  It is the hallmark of stocks
                      that make good short sales.   
See 165 Page Book "Killer Short Sale Techniques in Any Stock Market Environment"  

                           Massive Insider Selling at Citigroup - 2008

Citigroup's Chart     2008 ----------- 
wpe12A.jpg (68808 bytes)                                                       
Note bearish down-trending Day Traders' Tool
wpe12E.jpg (12088 bytes)
Heavy Red Down-Day Volume is bearish.
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New $20 Billion for CityGroup.

                                              by William Schmidt, Ph.D.

          Has The 2008 Decline Been Rigged To Let Bankers Steal A Trillion Dollars?

Wall Street's 30% decline since late September can be seen as part of a giant
                      extortion racket, to get the biggest bankers every penny they can from the US Treasury.  
                      By this view, the banks that want taxpayer money are spoiled, undeserving, under-achieveing,
                      overweight cry babies.   They seek to get all the money they can before Obama becomes
                      President.     By this view, the whole debacle looks and feels like one big fraudulent
                      manipulation, facilitated by how easy the SEC has made short selling.  

                           My own view is more complicated.  The banks have been very badly managed.  They
                      certainly do not deserve to be bailed out.  There are much better ways to use $750
                      billion.   It would have been better to just give every American $2500 and start a
                      new government owned and run bank to fill the void and to compete with the biggest banks,
                      if they unwilling to make new loans.  The private banks would get the money soon enough.

                           I do not think this is one gigantic bankers' conspiracy to get money.  The crisis
                      is now all too real.  And the banks really do not want the new regulation and government
                      controls that now seem likely.  Most important, the financial outlook is genuinely desperate.  
                      One only has to look at the price charts of one stock after another to see how
                      all-encompassing the financial crisis has become, especially since Paulson scared
                      Congress into giving him the $750 billion for bankers.  And, finally, a rally now is
                      overdue anyway, though the market will be pleased that some big unknowns are lifted
                      about the Obama Presidency.

                          Wall Street has now gotten what it wants from Obama.   Obama's advisors
                       are well known friends of Wall Street bankers: Geithner, Larwrence Summers,
                       and Bob Rubin.  And Obama has said he would delay raising the taxes on the very
                       rich until 2011.  There is no need for bankers to rush to take all they can from the
                       $750 billion bailout package.  Obama will not change the present bailout approach much.

                            Investors have now lost almost 10 trillion dollars since mid 2007 with Paulson as the
                      Secretary of the Treasury.  23 trillion dollars has been wiped out around the world.
                      All last year and until the Spring of 2008, Paulson repeatedly assured Americans that
                      the economic and financial systems were  "sound" and no economic stimuli was needed. 
                      He was terribly wrong.

                           Then things changed.  His own company's stock, Goldman Sachs, started to olunge.
                     Big banks like Lehman Brothers and Washington Mutual failed.  Paulson suddenly went
                     into panic mode.  He frightened the Congress into giving him $750 billion to give to big banks,
                     that's  $750,000,000,000  (or about $2300 for every US citizen).  He said there would be
                     disastrous consequences otherwise.  

                          In getting the bailout, he succeeded in one thing: he successfully scareed the
                      world's   financial markets into a disastrous 30% across-the-board panic that caused
                      hedge funds to fail, commodity prices to plummet and stock markets around the world
                      to go into free-fall.

                         Paulson is not getting enough in return for the billions he is giving the banks.  I have said
                      that he has gotten no guarantee that the banks will loan the money and no way once the
                      money is given to prevent the banks from using it to buy other banks, pay deferred executive
                      bonues, waste it on lavish resorts or pay big dividends to shareholders.  Without the
                      government getting representation on the companies board of directors, it has no protection
                      against the banks wasting the money.  The government would have gotten more for its money,
                      if it simply bought shares in the companies.  "Paulson has used the $700 billion in taxpayer
                      funds voted him by a labile Congress in September. Early on, Paulson put $125 billion in
                      the nine largest banks, including $10 billion for his old firm, Goldman Sachs. However,
                      if we compare the value of the equity share that $125 billion bought with the market price
                      of those banks’ stock, US taxpayers have paid $125 billion for bank stock that a private
                      investor could have bought for $62.5 billion, according to a detailed analysis from Ron W. Bloom
                      This means that half of the public’s money was simply a gift to Paulson’s Wall Street cronies.
                      ( Source.) 

                            Warren Buffett would have gotten much more for the taxpayers.  When he invested $5 billion
                       in Goldman Sachs and bought the same types of securities–preferred stock and warrants,
                       he received preferred shares that pay a 10 percent dividend, while the public gets only   5
                       percent.    Buffett also “received at least seven and perhaps up to 14 times more warrants
                       than the Treasury did.  On a percentage basis, his warrants were also much closer to the current
                       price of the shares.   Paulson simply gave away half the money to his cronies.

                                      CitiGroup Should Never Have Been Allowed To Get So Big!

                           With 374,000 employees world-wide, CitiGroup is the world's largest bank.  We are
                      told by Paulson that it is too big to fail.  Like an octypus, its tentacles reach out in all
                      directions, consumer banking, institutional banking, real estate lending, auto loans,
                      Primerica Financial Services and investment advise. 

                         Other key banks hold immense positions in it.  Barclay's holds nearly 238 millions shares,
                      worth $4.8 billion. Mellon Banks has 79.2 million shares worth $1.6 billion and UBS
                      holds 75.3 million shares, worth $1.5 billion.  It may be reasoned that the failure of CitiGroup
                      might well mortally wound these companies, such would be the drop in their assets versus
                      their debts and so much would be the psychological damage to investors' confidence world wide.
                      Clearly, it has been a huge mistake allowing CitiGroup to get so big.  The Federal Trade
                      Commission and Federal Reserve have miserably failed to protect the public int his respect,
                      quite apart from the now very evident impossibility of administering efficiently and
                      prudently such a huge monster.  These regulatory agencies, under laissez-faire ideologues
                      appointed by Bush. have blantantly disregarded their mandate to protect the public from
                      CituGroup's sheer power, as a vast oligarchy with boards of directors that are interlocking
                      and anti-competitive.

                                                                        wpeF7.jpg (6699 bytes)
                                                          Citigroup - Chief Financial Officer, Gary L Crittende
                             Bad decisions at the top to make loans to home owners, much more aggressively
                       than many other banks did, has laid Citigroup low.  The people at the top wanted the big
                       numbers to get their million dollar bonuses, but did not want to hear about how
                       bad many of the loans were.   Now it is the taxpayer and all Americans who are being
                       made to  pay the still exorbitant salaries at CitiGroup to the very same managers who
                       made this mess.   

       "Citigroup became ensnared in murky financial dealings with the defunct energy
                       company Enron, which drew the attention of federal investigators; it was criticized by law
                       enforcement officials for the role one of its prominent research analysts played during the
                       telecom bubble several years ago;  and it found itself in the middle of regulatory violations
                       in Britain and Japan....As it built up that business, it used accounting maneuvers to move
                       billions of dollars of the troubled assets off its books, freeing capital so the bank could grow
                       even larger..
                            ( http://jessescrossroadscafe.blogspot.com/2008/11/robert-rubins-culpablity-in-bubble-that.html )

                          Executive pay at CitiGroup is a profanity.  It payed its Chief Financial Officer,
                      Gary L Crittenden $19.2 million this past year. He should be fired and sued for malfeasance!
                      He has overseen the company's chief finance officer since March 12, 2007.  He is a
                      Harvard MBA, just like George Bush. 

                                             Robert Rubin Advocated Using More Leverage at Citigroup

                            Citigroup insiders and analysts say that its former CEO until 2007 and Rubin played
                        pivotal by drafting and implementing a "strategy that involved taking greater trading risks
                        to expand its business and reap higher profits."  In fact, it was Rubin who explained the
                        benefits of being more aggressive to the new CEO, Charles Prince, in 2002 and how
                        best to do so.  "
"Chuck was totally new to the job. He didn't know a C.D.O. from a grocery
                        list,   so he looked for someone for advice and support. That person was Rubin. And Rubin
                        had always been an advocate of being more aggressive in the capital markets arena. He
                        would say, 'You have to take more risk if you want to earn more
.' " (Source. )

                             Clinton's Ex-Treasury Secretary, Robert Rubin, is now dancing quickly away from
                       controversial Citigroup.  But the fact remains that "(h)e has collected more than $150
                       million in cash and stock over eight years to serve as the bank’s elder statesman, meeting
                       with important clients and building relationships with government and business leaders
                       around the world, though his contract states that he is to have no daily operational
" (Source.)  

                                  Insider Selling by Robert Rubin at CitiGroup            

77,500 Direct Sale at $55.05 - $55.05 per share. $4,266,0002
124,250 Direct Acquisition (Non Open Market) at $0 per share. N/A
196,624 Direct Disposition (Non Open Market) at $48.36 - $48.36 per share. $9,509,0002
234,353 Direct Option Exercise at $33.44 - $33.44 per share. $7,837,0002

                              As much as anyone in Citigroup, Rubin advocated using more leverage to make
                        more loans to make more money.  A year ago I noted that he must have known dire trouble
                        was going to engulf CitiGroup as a result of its use of levevage and its lack of controls
                        on the quality of their loans.  So, Rubin sold almost 400,000 shares when the stock was
                        between 33 and 55 and he turned down the CEO job.  He denies this. He claimed that 
                        "Few if anyone" anticipated the financial meltdown.   Not remotely true.   See NYU Professor
                        Nouriel Rubini's dire warnings to International Monetary Fund in late 2006 and ever since.


                             All these bankers knew they were making poor quality loans.  They knew it.  They
                        did it anyway, because someone else, they calculated would own the bundled mortgages
                        they way selling as AAA quality to investors around the world.  "There's really no profit in
                        remaining ethical. Perhaps we should teach our children to incorporate, then rip off every
                        single sucker they can and retire at 40. Join a a gang and commit crimes under mob rule -
                         that's the ticket to success in the good old U.S. of A. it seems to me.
  I don't think any of
                         them are even the least bit ashamed.
" (Source.)   "Whistle blowers (people who complained
                         that 'this ain't right') were fired, excluded, demoted, transferred away from Realty Agencies,
                         Mortgage Brokers, Banks and Appraisers offices across the country - The reason I call them
                         whistle blowers because it's become apparent that the people calling foul in the mortgage
                         lending industry were correct, while they were punished by their peers both financially and
                         emotionally for pointing out the moral hazards of their occupation
."  ( Source. )  "Honest
                         appraisers and loan officers were penalized, blacklisted, not payed and fired. "Recently while
                         talking to a senior underwriter for a major Wall Street bank, she shared with me that she
                         had witnessed the sinister inner workings of the lending industry first hand. The underwriter’s
                         job is to provide an unbiased assessment of the risk level of a particular loan.
" ( Source. )   

                                          Robert Rubin's Role in Making The National Housing Bubble
                                As Treasury Secretary for Clinton, Robert Rubin lobbied hard to get the President to
                         allow banks to get into the securities' business, thereby giving them new reason to make
                         unsafe loans and exaggerate their safety as they package them to others to invest in.
TigerSoft Blog and News Service - 9/21/2008 - Monopoly Finance)


              Justice...wink, wink

                Delaware Justice, Inc.

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( http://www.delawarelitigation.com/unkindPanel(1).jpg )

     Judge tosses most claims in Citigroup lawsuit

2/26/2009  Delaware judge dismisses most claims in Citigroup subprime lawsuit

DOVER, Del. (AP) -- A Delaware judge has dismissed most claims in a shareholder lawsuit seeking to hold Citigroup Inc. directors liable for losses related to the subprime mortgage market.  In a ruling issued Tuesday, the court said the
plaintiffs had failed to show that officials for New York-based Citigroup breached their oversight obligations or acted
in bad faith in monitoring the company's exposure to subprime securities.

The judge did allow the plaintiffs to pursue claims related to the board's approval of a $68 million departure
package for former Citigroup CEO Charles Prince, who left the company in 2007.   Shareholders alleged that
current and former directors and officers of Citigroup breached their fiduciary duties by failing to properly monitor
and disclose the company's exposure to subprime securities.

Comments by Bill M form Bethlehem, PA
"Delaware also cranks out more money by having the most pro-business laws, including laws that make it by far
the most favorable for business (which is why the huge majority of U.S. companies are registered as Delaware
corporations, thus giving the state a huge windfall from registration fees). Unfortunately for the consumer, Delaware's
pro-business climate can also mean anti-consumer--the sleazy payday-loan industry, for instance, relies on Delaware
banks to front the funds, since DE is one of the very few states that have virtually no usury (loan-sharking) laws."




        See also   http://www.insider-monitor.com/trading/cik831001.html
                        White Collar Crime Prof Blog: Insider Trading Based on Recklessness
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