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Citigroup’s hopes for investment from Chinese bank hit a snag

NEW YORK: Citigroup’s talks with the China Development Bank to make a multibillion-dollar investment in the company have reached an impasse after the Chinese government spurned a possible deal, according to a person close to the situation.

While Chinese investment groups have bought big stakes in Wall Street firms like Bear Stearns and Morgan Stanley, the scuttled deal suggests there may be limits on how much the Chinese government is willing to invest in the Western banking system. The exact reasons for the breakdown are unclear, and it is possible the two sides may return to the negotiating table.

Citigroup is turning to cash-rich investors, including foreign governments, for a second time as it confronts mounting losses on mortgage-related investments. It hopes to raise about $10 billion, people briefed on the plan said Friday. [snip]

In the prior post on this subject, I mentioned how the Chicoms have bought into the US banking industry, along with the Arabs. Well, I think the Chinks just choked. There are limits; someone in charge of the yuans, woke up saying this ain’t chop suey!

Where did the $24 billion go? It wasn’t and isn’t paper profits like a stock purchase. This money changed hands many times. The 24,000 individuals getting the free career makeover will have time to look for the loot.

This isn’t a speed bump in Citi’s business, it’s what a pilot calls a mountain: “a vertical speed brake.”

Hits like this can finish off a business, if only because others shy away from getting caught in the slipstream. WHEN, not if, all lending slows down, the clanking you hear is the wheels coming off the tracks.

Citigroup’s Layoffs Could Reach 24,000 This Year

Citigroup plans to announce a writedown of as much as $24 billion and layoffs of up 24,000 due to subprime and credit-related losses, CNBC has learned.

The plans will be unveiled Tuesday by Citigroup’s new CEO, Vikram S. Pandit, after the banking giant reports fourth-quarter earnings. At the same time, Citigroup could also announce that it is cutting its dividend payment. [snip]

The MSM keeps talking about the deficit, never a peep about the national debt. (Deficits are a common condition in business)

Meanwhile, the Chicoms hold enough T-Bills to destroy our economy. Arab consortia are bailing out the banks, actually owning enough through loans to become shadow owners. The Social Security costs shortly finish off any spare change in our economy.