Flashback July 10, 2007Chuck Prince: No End Soon to Buyout Boom...

Flashback July 10, 2007Chuck Prince: No End Soon to Buyout Boom “When the music stops, in terms of liquidity, things will be complicated. But as long as the music is playing, you’ve got to get up and dance. We’re still dancing'.Flash Forward November 2, 2007The party is over and the music has stopped for Chuck Prince. His last dance is a two-step out the door. Citi's Prince Plans to Resign BEA 4th Quarter GDP 1st Estimate 0.7% Q&A: Why Did GDPNow Rise After Durable Goods? When are Construction Revisions Coming? Chuck Prince: No End Soon to Buyout Boom “When the music stops, in terms of liquidity, things will be complicated. But as long as the music is playing, you’ve got to get up and dance. We’re still dancing'. Charles Prince, the beleaguered chief executive of Citigroup Inc., is planning to resign at a board meeting on Sunday, according to people familiar with the situation. Just a few weeks ago, board members including Robert Rubin, the influential chairman of Citigroup's executive committee, expressed support for Mr. Prince and said that his job wasn't in jeopardy. 'I think Chuck's going to be here for a lot of years,' Mr. Rubin said in an interview last month. Any change of heart may also have been spurred along this week after the board of Merrill Lynch & Co. ousted its embattled CEO, Stanley O'Neal. In reporting its third-quarter earnings, Citigroup warned that it endured a surge in late payments on consumer mortgages in September, costing the bank $3 billion in higher losses and reserves against future bad loans and hurting the value of loans Citigroup hopes to sell to investors. Chief Financial Officer Gary Crittenden said the trend is likely to continue. Citigroup also booked $1.56 billion in pretax losses tied to loans and subprime mortgages that were to be repackaged and sold to investors. Equally important, the bank said its capital levels had dwindled to below the company's internal target ratios. Executives said the company would stop repurchasing its own shares until it rebuilt its capital, a process it hopes to complete by early next year. Some analysts and other experts think Citigroup will have to take more drastic actions, such as selling off assets or slicing its dividend payouts. Prince's retirement solves nothing actually. And of all the issues at Citigroup, capital levels is the most critical one. With capital concerns come side issues such as a The content on this site is provided as general information only and should not be taken as investment advice. All site content, including advertisements, shall not be construed as a recommendation to buy or sell any security or financial instrument, or to participate in any particular trading or investment strategy. The ideas expressed on this site are solely the opinions of the author(s) and do not necessarily represent the opinions of sponsors or firms affiliated with the author(s). The author may or may not have a position in any company or advertiser referenced above. Any action that you take as a result of information, analysis, or advertisement on this site is ultimately your responsibility. Consult your investment adviser before making any investment decisions.