In news that should make everyone sit up and take notice, Citigroup has put together a proposal to raise about $14 billion in new capital. Most of it coming from overseas sources, in particular China and the Middle East.
The Financial Times notes that it’s the subprime lending crisis that is fueling this need for foreign capital injection…
The deal underscores the depth of the problems faced by banks that suffered heavy losses in the US subprime mortgage crisis. It would follow an injection of $7.5bn into Citigroup by the Abu Dhabi Investment Authority in late November.
Clearly something is wrong here. So what can be done to stabilize the U.S. Dollar and the American economy in these uncertain times?
January 12th, 2008 at 8:20 pm
Maybe we should get someone in office and into the Federal Reserve that doesn’t genuflect before his radical free market ideologies and is willing to regulate unscrupulous behavour.
Kick in sarcasm…I want an ownership society. The fact that I’ll fund this ownership society by tons of bad debt and high interest credit cards that I can’t possibly pay back is just a red herring brought up by communists like Hillary Clinton.