Comments on: Citigroup puts lipstick on a pig in third quarter earnings report http://jubakpicks.com/2009/10/15/citigroup-puts-lipstick-on-a-pig-in-third-quarter-earnings-report/ Sun, 12 Feb 2012 18:19:20 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: ryanpatrik http://jubakpicks.com/2009/10/15/citigroup-puts-lipstick-on-a-pig-in-third-quarter-earnings-report/comment-page-1/#comment-1417 ryanpatrik Mon, 19 Oct 2009 19:42:40 +0000 http://jubakpicks.com/?p=1659#comment-1417 Notwithstanding all of the above I am a buyer of C in the mid fours and I will make an excellent return if I am patient. Unless the Sheik sells..then all bets are off since he is a main reason C was a rescue. I love the comments about Goldman. Can there be any doubt they are, to put it nicely, "better informed" traders than the rest of us? I have noticed however that if you wait a couple days after a GS downgrade of a quality company you can pick the stock up for a pretty decent short term gain. If I had enough money perhaps they would tell me when they are about to downgrade someone! Notwithstanding all of the above I am a buyer of C in the mid fours and I will make an excellent return if I am patient. Unless the Sheik sells..then all bets are off since he is a main reason C was a rescue.
I love the comments about Goldman. Can there be any doubt they are, to put it nicely, “better informed” traders than the rest of us? I have noticed however that if you wait a couple days after a GS downgrade of a quality company you can pick the stock up for a pretty decent short term gain. If I had enough money perhaps they would tell me when they are about to downgrade someone!

]]> By: Jim Jubak http://jubakpicks.com/2009/10/15/citigroup-puts-lipstick-on-a-pig-in-third-quarter-earnings-report/comment-page-1/#comment-1387 Jim Jubak Fri, 16 Oct 2009 22:49:08 +0000 http://jubakpicks.com/?p=1659#comment-1387 YX, John Reed. Boy that's a blast from th past. Reed's sin, the one that got him booted to the sidelines, was to believe he could build the world's best consumer bank--and that the profits from that would be enough. How that franchise has fallen. Walk into any Citigroup branch in Manhattan and then walk into any Chase branch. The Citi branch feels down at the heels. The technology is old and second rate. (Not to say Chase is a great consumer bank. Hey I take my kids to TD Bank (once Commerce). They still have lollypops. What bank in its right mind doesn't understand that a 3 cent lollypop is a very cheap way to build lifelong customer loyalty. YX, John Reed. Boy that’s a blast from th past. Reed’s sin, the one that got him booted to the sidelines, was to believe he could build the world’s best consumer bank–and that the profits from that would be enough. How that franchise has fallen. Walk into any Citigroup branch in Manhattan and then walk into any Chase branch. The Citi branch feels down at the heels. The technology is old and second rate. (Not to say Chase is a great consumer bank. Hey I take my kids to TD Bank (once Commerce). They still have lollypops. What bank in its right mind doesn’t understand that a 3 cent lollypop is a very cheap way to build lifelong customer loyalty.

]]> By: Jim Jubak http://jubakpicks.com/2009/10/15/citigroup-puts-lipstick-on-a-pig-in-third-quarter-earnings-report/comment-page-1/#comment-1386 Jim Jubak Fri, 16 Oct 2009 22:44:18 +0000 http://jubakpicks.com/?p=1659#comment-1386 dblwyo, I think you've hit on a essential truth about Goldman. Their strategy has been to become the market in as many trading segments as possible. That allows them to charge their clients for executing the clients' trades. And to reap huge trading profits from their knowledge of what their clients are going to do. So, yes, I'd absolutely agree with your assessment that they profit by front-running their clients buys and sells. (For those unfamiliar with the term front-running is when a manager trades for his or her account before executing a client's trade that they know or hope will move the market price.) Goldman has gotten so big and influential in the last decade that I'd be willing to argue that they treat the U.S. government and the Treasury as clients and front run the policy decisions made by the Goldman alums who run the money end in Washington. dblwyo, I think you’ve hit on a essential truth about Goldman. Their strategy has been to become the market in as many trading segments as possible. That allows them to charge their clients for executing the clients’ trades. And to reap huge trading profits from their knowledge of what their clients are going to do. So, yes, I’d absolutely agree with your assessment that they profit by front-running their clients buys and sells. (For those unfamiliar with the term front-running is when a manager trades for his or her account before executing a client’s trade that they know or hope will move the market price.) Goldman has gotten so big and influential in the last decade that I’d be willing to argue that they treat the U.S. government and the Treasury as clients and front run the policy decisions made by the Goldman alums who run the money end in Washington.

]]> By: dblwyo http://jubakpicks.com/2009/10/15/citigroup-puts-lipstick-on-a-pig-in-third-quarter-earnings-report/comment-page-1/#comment-1357 dblwyo Fri, 16 Oct 2009 12:30:15 +0000 http://jubakpicks.com/?p=1659#comment-1357 When you look at banks it turns out you need to look at lines of business (wealth mgt, consumer finance,credit cards, business finance, securities mgt srvcs and trading). The only non-broken bizzmod is the first, the middle three are facing horrendous and mounting losses, and the last breaks down into sub-sectors including proprietary trading. Whether or not any bank made money depends on their mix and not surprisingly GS made money and C/BAC are loosing big time and are at risk of more. The regionals, focused on CRE are in deep trouble. Pandit has been trying to re-engineer Weill's disastrous mess put has had tsunami after tsunami cross a dike with many holes in it. GS is profitable almost entirely on proprietary trading profits which have dominated it's business since '03; it's effectively a hedge fund that makes money by front-running its clients based on the information it gets from being their servicing agent. One has to wonder what the social value of proprietary trading is. Net net the banks are facing a decade of B/S re-building, years of mounting loan losses and the only source of profits being chicanery (think surcharges, credit card charges or proprietary trading). If you want to analyze their outlook work thru the LOBs and understand the credit risks and profitabilities. When you look at banks it turns out you need to look at lines of business (wealth mgt, consumer finance,credit cards, business finance, securities mgt srvcs and trading). The only non-broken bizzmod is the first, the middle three are facing horrendous and mounting losses, and the last breaks down into sub-sectors including proprietary trading. Whether or not any bank made money depends on their mix and not surprisingly GS made money and C/BAC are loosing big time and are at risk of more. The regionals, focused on CRE are in deep trouble. Pandit has been trying to re-engineer Weill’s disastrous mess put has had tsunami after tsunami cross a dike with many holes in it. GS is profitable almost entirely on proprietary trading profits which have dominated it’s business since ’03; it’s effectively a hedge fund that makes money by front-running its clients based on the information it gets from being their servicing agent. One has to wonder what the social value of proprietary trading is. Net net the banks are facing a decade of B/S re-building, years of mounting loan losses and the only source of profits being chicanery (think surcharges, credit card charges or proprietary trading). If you want to analyze their outlook work thru the LOBs and understand the credit risks and profitabilities.

]]> By: ponymagic http://jubakpicks.com/2009/10/15/citigroup-puts-lipstick-on-a-pig-in-third-quarter-earnings-report/comment-page-1/#comment-1356 ponymagic Fri, 16 Oct 2009 03:05:40 +0000 http://jubakpicks.com/?p=1659#comment-1356 Jim: Could you comment on this article sited by terryw? I've always thought of GS as the smartest guys in the room. Like many others, I've been (profitably) betting on commodities and foreign stocks on the assumption that the dollar would keep getting clobbered. Aside from the possibility of a major pullback in the indices is there any way you see the dollar trend reversing in say the next 6 months? Thanks! Jim:

Could you comment on this article sited by terryw? I’ve always thought of GS as the smartest guys in the room.

Like many others, I’ve been (profitably) betting on commodities and foreign stocks on the assumption that the dollar would keep getting clobbered. Aside from the possibility of a major pullback in the indices is there any way you see the dollar trend reversing in say the next 6 months? Thanks!

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