imported post
Citi is in huge financial trouble already. This 2a issue is all the more reason to pull any business from them. If you don't like what Citi is doing look at your credit cards and if they are Citi cancel them, if you have accounts with them close them.
2a violations are not cool and I would be concerned this is the first of other credit card companies following suite. Show them it is unacceptable by stopping business with them.
They have quietly begun limiting wire transfer amounts and limiting ATM withdrawals in NYC, pointing to a cash shortage.
If you have your money in a Citi account and they go bankrupt where does your money go???
They are heavily invested in derivatives like the sub-prime market. Many banks are over-extended and if all of their customers asked for their money right now, they wouldn't have it.
Excerpt from:
http://www.moneyandmarkets.com/issues.aspx?Dangerously-Close-to-a-Money-Panic
"Helping to cut through some of the uncertainty, the OCC evaluates the credit exposure of each U.S. bank holding derivatives. In other words, it asks the question:
Regardless of whether the bet is a win or a loss, what happens if the investor on the other side of the bet doesn't pay up?
In normal times, such payment defaults are rare. So this is largely a theoretical question. But in a money panic, when markets can go haywire and available cash financing can suddenly dry up, a chain reaction of defaults could make this a very urgent and practical question.
Here are the answers, according to OCC data:
Overall, including all types of derivatives ...
Wachovia has credit exposure that's equivalent to 89% of its capital. In other words, if all of its counterparties defaulted on their bets with Wachovia, nearly nine-tenths of its capital would be wiped out.
Bank of America is exposed to the tune of 99% of its capital. Assuming no capital infusions, it could be virtually wiped out in an extreme money panic scenario.
And at three banks, the panic would not have to be quite that extreme:
Citibank has 292%:what: of its capital exposed to this kind of credit risk.
JPMorgan Chase has 387% of its capital exposed.
HSBC beats them all with an exposure of 388% of its capital. That means that even if its counterparties defaulted on just 26% of their bets, its capital could be wiped out."
Vote for the 2a with your dollars.
