Tag Archives: Wachovia

We’re Getting on a Plane and the Economy is Going Down the Tubes

Black Monday Recalled

Good morning from the Louis Armstrong International Airport. Yes, for you without GPS capability, that means I’m in New Orleans. I’m leaving this morning for Dallas, where I will attend the Southwest Airlines’ Media event Tuesday and Wednesday.

I’m sitting here looking out the window at the US Airways Piedmont retro livery. What a cool airplane. Then again I’m a sucker for most any retro paint job.

Actually, I’m looking at the Piedmont livery in-between reading about the meltdown in the financial markets, both here and overseas.

All jokes aside (re: the Origami Bank folded overnight) it’s not good out there folks. As the ex-CEO of Salomon Brothers, John Gutfreund, said this morning on CNBC, the problem is — nobody knows what the hell is going on or how bad things really are. Either here or in Europe. Much less Asia.

My personal take is that John is exactly right.

The FDIC announced a deal this morning between Citi and Wachovia. I was not able to hear just what Citi is taking over and what it is not. But it sounds very similar to the WaMu deal last week.

While they are both being cloaked as having been “absorbed” or “taken over” by other banks — the truth is that both banks failed. Period.

And I doubt they are going to be the last.

Meanwhile on the other side of the pond, Belgian-Dutch banking and insurance group Fortis was propped up as the governments of Belgium, the Netherlands and Luxembourg took a 49% interest in the financial, banking and insurance group, in return for an injection of $16.4 billion.

But that’s not all.

The U.K. Treasury said Monday it took control of Bradford and Bingley and will transfer the midsized mortgage lender’s retail deposits business and branch network to Abbey National. B&B is a major provider of mortgages in the U.K.

Meanwhile back on this side of the pond, the Federal Reserve announced a massive injection of liquidity — a deal that involves the central banks of a number of European countries

I’m not sure I want to see what’s going on when I get off the plane at Love Field.

Hang in there folks. It’s going to be a very rough day on Wall Street.