Bursting prime mortgage bubbles, high lending interest rates, outstanding residential credit card and real estate/mortgage debt, escalating defaults and a weakened economy have all contributed to the collapse of Citigroup. Citigroup Services has had to cut a colossal 77,000 jobs! Its shares have taken a nose dive and keep on plummeting. Doubts and fears are growing as uncertainties linger in all markets. In a swift move of damage control, it is raising the concern and doing everything in its capacity to minimize its losses and cut its costs, utilising all or a combination of various workable solutions to alleviate the impact of its collapse.
The company has since been in talks with the U.S. congress seeking to be rescued. The U.S. government, however, has already planned the investment of $25 billion in Citigroup as part of its £700 billion financial bailout package. Citigroup has also considered a fire sale in light of the financial crisis that has crippled the company. Merging with Goldman Sachs or nationalization are two other options on the table. The company is also considering selling off its risky assets to trim down its portfolio in the ailing economy. Its main single investor, Prince Waleed Bin Talal has offered to increase his stake in the bank by 1%, from 4% to 5%.
In these times of deep financial crisis, many industries and companies lay in the balance, at the mercy of the sometimes unforgiving nature of economics. Are these the times of profound American financial change? Have both New York and Detroit’s life cycles reached their
death? Are they even fit to survive?
In these times of deep financial crisis, many industries and companies lay in the balance, at the mercy of the sometimes unforgiving nature of economics. Are these the times of profound American financial change? Have both New York and Detroit’s life cycles reached their
death? Are they even fit to survive?
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