Government unveils bold plan to rescue Citigroup

Rushing to rescue Citigroup, the government agreed to shoulder hundreds of billions of possible losses at the stricken bank and to plow a fresh $20 billion into the company.

Regulators hope the dramatic action will bolster badly shaken confidence in the once mighty banking giant as well as the nation’s financial system, a goal that so far has been elusive despite a flurry of government interventions to battle the worst global crisis since the 1930s.

The action, announced late Sunday by the Treasury Department, the Federal Reserve and the Federal Deposit Insurance Corp., is aimed at shoring up a huge financial institution whose collapse would wreak havoc on the already fragile financial system and the U.S. economy.

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Posted in * Economics, Politics, Credit Markets, Economy, The Credit Freeze Crisis of Fall 2008/The Recession of 2007--, The September 2008 Proposed Henry Paulson 700 Billion Bailout Package

3 comments on “Government unveils bold plan to rescue Citigroup

  1. Byzantine says:

    What is this great crisis that requires such an appalling and unconstitutional transfer of wealth to this publicly traded company? When President Obama and his Democratic Congress start bestowing largesse in a similar fashion I don’t want to hear a single Republican complaint.

    This makes me absolutely sick. We are a socialist country of spoiled children who refuse to live within their means.

  2. Sick & Tired of Nuance says:

    Just how much [i]is[/i] a [b]billion[/b] dollars?

    Well, if someone were to give you $1 Billion on the condition that you would have to spend $100,000 per day until it was all gone…it would take you 27.39 years to spend it all! [And that’s without getting any interest.] That means that I could completely pay off my mortgage every day without stopping for the next 27.39 years!

    Think about that. If you have a $200,000 mortgage, you could pay it off every two days for almost 30 years!

    This ONE institution is getting $20,000,000,000. That is enough to INSTANTLY pay off completely…100,000 mortgages of $200,000!

    I have said it before, I think it would be cheaper to just pay off every single residential mortgage than to keep bailing out these companies. But then, we would all stop being wage slaves. That won’t do. Better to give the money to the gang in the millionaire club.

  3. Little Cabbage says:

    Oh, great! The fat cats on Wall Street getting more of our $!!!