Citibank is now Citi-buck!

Today we had some record breaking new “lows” made in the stock market. Hard to believe is Citicorp was trading below $1.00 today. I believe that is the lowest price ever for that stock. I owned that stock over 20 years ago and it was one of my first stocks I ever purchased. I think I held on to it for about 6 years and more than tripled my capital back then. I took a chart at yahoo for the past 30 years and pasted it below. Look at the way the stock falls off the cliff at the end there.

citicorp-stock-prices1

This is a company that both the Bush and Obama cabinets have bailed out 3 times now. At under a buck a share, it is more likely that the government will just bail it out completely by taking it over.

Citigroup’s Third U.S. Rescue May Not Be Its Last, Analysts Say

Feb. 28 (Bloomberg) — The U.S. government’s third attempt to help rescue Citigroup Inc. won’t stanch the company’s losses, which will continue to swell and may lead the bank to require more money in coming months, analysts said.

One immediate change from yesterday’s announcement was that the value of the government’s investment fell by more than half. The government said it would convert as much as $25 billion of its preferred stock to common shares for a 36 percent stake in the bank. At yesterday’s closing price of $1.50, that investment is worth about $11.5 billion. Citigroup has a stock market value of $8.2 billion today.

‘Ripped Off’

“Taxpayers are being ripped off,” Congressman Brad Sherman, a Democrat from California who sits on the House Financial Services Committee, said in a statement. “The only thing worse than nationalizing a bank is to pay for the entire bank and only get one-third of it.”

Goldman Sachs Group Inc.’s analysts, led by Richard Ramsden, recommended that investors avoid Citigroup shares because “it is unclear whether this is the last round of capital restructuring, which means that existing equity may be further diluted in the future.” The analysts also noted that the bank’s new 4.3 percent ratio of tangible common equity to total assets falls to just 2 percent if deferred tax assets are excluded. Those will only become valuable if and when the bank returns to profitability.