There’s something weird about the way Citigroup shares have hurdled downwards, which we’ve been trying to put our finger on. It finally occurred to us when we loaded up WSJ.com last night before going to sleep. We were struck by an article that wasn’t there, the one about about senior Citi execs being in a state of panic, holding emergency meetings to clean house, sell units, and flying out to Hong Kong hat in hand for one last hit of capital.
Now there can’t be any doubt that Citi execs are freaking out (they have to be), and banks don’t want these stories to come out, but the message emanating is one of complacency. That big town hall on Monday was a total joke. It produced no rally in shares at all, and there should’ve been a host of backbiting and recrimination stories to pour out. Nope. Today we get a non-story about Prince Alwaleed buying a pittance of Citigroup shares and some statement of confidence in current management. Translation to the market: the biggest shareholder doesn’t see any need for a dramatic change. <sarcasm>Perfect, that’s exactly the message you want to be sending right now </sarcasm>.
This is not to say there’s been a total paucity of internal dissencion stories. There was one story in the Journal about some efforts to replace chairman Win Bischoff, but Citigroup quickly said it was a lie, which was probably a mistake, since the story at least showed there was frustration and a pulse left in there. When sources told our John Carney that Pandit was fighting for his life with the town hall, that was a good sign — he better be fighting for his life at this point — but the message hasn’t gotten through. At this point, it might be a wise idea to float a trial balloon out there… put out a story in the Journal hinting Pandit might just have one day left at the job, you know, just to see how the stock reacts.
[Citi employees: Save your company! Don’t wait for the PR people to realise that they need to start being honest. Send us your thoughts, hope, dreams and stories about what it’s like to work at Five Bucks and A Dime Citi. We’ll always keep it 100% anonymous. Email us or text us: 646-526-3327.]
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