One the biggest pieces of business news today was the continuing fall of Citigroup shares, and at their current levels below $5, you’d have to trace the charts back to 1993 to find a similar low. Despite continued reassurances of liquidity, shareholders aren’t listening and are dumping the stock en masse. Volume was well over 700 million today. Failure isn’t much of a danger – the American government/central bank would never allow such a crippling event to occur; however the face of banking will be seriously changed even if a full government bailout were to occur.
Furthermore, I found the advertisement below the Citigroup chart at Yahoo! Finance to be quite shocking.
Yes. That’s General Motors advertising its bailout plan.
What has the world come to?
An interesting thing is many funds are not allowed to hold shares of a company that are below $5.00. Thus, if Citigroup continues to stays below $5.00, many funds would have to liquidate their Citi holdings. This would add further downward pressure to the stock price, almost guaranteeing that without some sort of support its share price will continue to erode.
I wonder how much that ad cost for GM?
Rumor was Citi also laid off ~75000 people worldwide, mainly in their London HQ….