FDIC forces Wachovia to sell....

[geochem1st]

I think that my lucky streak may continue. This morning the Feds forced Wachovia to sell itself before it crashed to Citicorp. My division is CMG that stayed with the much smaller Wachovia. Going to a meeting now to see how this may all fall out.


Citigroup buys Wachovia bank biz for $2.2B - Sep. 29, 2008

[River]

Originally Posted by geochem1st

I think that my lucky streak may continue. This morning the Feds forced Wachovia to sell itself before it crashed to Citicorp. My division is CMG that stayed with the much smaller Wachovia. Going to a meeting now to see how this may all fall out.


Citigroup buys Wachovia bank biz for $2.2B - Sep. 29, 2008

[geochem1st]

Looks like Wachovia had a "run" on the retail bank starting thursday and ending friday. The analysts are saying that the run was brought about by the collapse of "Wamu". Then Wall ST. put the final nail in our coffin, our stock went from $10/share on Friday to $0.95, on closing bell Friday. This triggered the emergency meeting of the FDIC which brokered the sale of Wachovia, since the FDIC didn't have enough funds to guarantee the accounts.

The panic has started people.

We are in deep shit.

[River]

So how's your job looking?

[geochem1st]

I'm on a phone conference right now as I type, from my immediate group, about your question.... I'll get back to ya.

[geochem1st]

It depends on Wall Street and how Wachovia will be valued from this point on. Wachovia has lost its debt, but it's whether we can retain our customer base. As it is people are running on the banks, pulling out of the stock market, and putting their money into government bonds. Citicorp stock has gone up roughly $0.50/share. Wachovia will start trading at $1! Scary.

[River]

Originally Posted by geochem1st

It depends on Wall Street and how Wachovia will be valued from this point on. Wachovia has lost its debt, but it's whether we can retain our customer base. As it is people are running on the banks, pulling out of the stock market, and putting their money into government bonds. Citicorp stock has gone up roughly $0.50/share. Wachovia will start trading at $1! Scary.

I heard 30-year treasury bills were selling such that the effective interest rate was 0%. Scary, yeah - to put it mildly.

[Hemply]

Things are definately looking scarey out there.

Luckily I have not had any serious adverse affects myself but I also understand no one is safe at this time which makes it even more frightening!

I noticed this coming two years ago and since then reassigned what stock options I could to safer areas. Also turned cash into more lucrative holidings.

Good luck to you Geochem, I sincerely hope all will be well with you.

[gibiphone]

Originally Posted by Hemply

Things are definately looking scarey out there.

Luckily I have not had any serious adverse affects myself but I also understand no one is safe at this time which makes it even more frightening!

I noticed this coming two years ago and since then reassigned what stock options I could to safer areas. Also turned cash into more lucrative holidings.

Good luck to you Geochem, I sincerely hope all will be well with you.

Yeah, I hear you. Bout 2 years ago I also moved out of the market into safer areas, EXCEPT for a Chunk I left in Harley-Davidson--gotta be loyal to something. Well, that 'Chunk' of change is now just a 'Chu' and I suspect I will be lucky to be left with a 'C' note, if you get my pun!!

Good luck Chem, hope you keep your job.

[geochem1st]

thanks guys.

[djwilbanks]

How's thing going now, Geo? Any word?

[Hemply]

Originally Posted by gibiphone

Yeah, I hear you. Bout 2 years ago I also moved out of the market into safer areas, EXCEPT for a Chunk I left in Harley-Davidson--gotta be loyal to something. Well, that 'Chunk' of change is now just a 'Chu' and I suspect I will be lucky to be left with a 'C' note, if you get my pun!!

Good luck Chem, hope you keep your job.

Oh I hear that! That's what we get for being loyal to Made in the USA!

When I started to see my stocks consistantly losing money I stuck what I could in Bonds. I have a close friend who is a jewler and back then mentioned to me the price of gold was going up considerably and would be over the next few years. So in 2007 instead of investing in the tanking market I purchased gold and precious gems. 2008 brought the Les Paul investments... ok that was more for me but damn it I'm going to have something to sell if this market doesn't make a come back!!

[coldsteal2]

Guys i felt the first financial earthquake early this morning
when i aplied for a Muscians Friend credit and was turned
down in '2 seconds" i mean 2 Seconds!!!!
Then i tried at zZounds and the same thing.
I went back to bed woke up to find out the stock market is
F'd......and so is my credit

[River]

Many here have been saying for months that the vintage guitar market will go down because of lack of disposable income. I'm thinking it may be just the opposite. People are flocking to tangibles. But WTH do I know?

[05jrock]

Whats with the supposed bailout by Bush and his merry men?

Heard on friday it was all go and today hear it has been rejected.
Not that it will be a quick fix anyway.

[coldsteal2]

Looks like now the damage may be to late
for it to do much good

I heard that during Nancy Pelosi's rant the stocks were droping
like lead balls

[River]

Originally Posted by coldsteal2

Looks like now the damage may be to late
for it to do much good

I heard that during Nancy Pelosi's rant the stocks were droping
like lead balls

IMHO, no talking head is gonna affect this outcome one way or the other. It's time for everyone to do the right thing. Do I (or they ) know what that is? I doubt it.

[kernelofwisdom]

We're watching closely. I've got old ties to Wachovia, and our line of credit and financing instruments are through them...

What crap, these institutions busted through the greedy strategies of a few people at the top, and the need to "run with the herd" to keep the stock price going up.

It's funny we have banks too big to fail now, and it looks like we'll end this with even fewer banks.

Anyway, geo, I hope things are stable for you guys and your job rocks along. Wachovia had a lot of sound accounts too, but I have no idea what the story is for them now.

[NeoConMan]

Keep us in the loop with whatever insight you can offer, anything outside the media is appreciated.

Good luck to you.

As a firm believer in owning tangibles, I'm heading out to buy some more ammo.
Got enough guns and guitars to last awhile...

[River]

So when a bank goes under, and you have cash and loans with them, do you lose the cash and keep the loan?

[djwilbanks]

Originally Posted by River

So when a bank goes under, and you have cash and loans with them, do you lose the cash and keep the loan?

Generally a new bank buys them out, and you keep your loans and your cash... its just with a new bank.

It happened here when Liberty Bank bought out MidSouth Bank, I kept my checking account and all the money, just got a new bank name on my checks.

It's essentially the same thing regardless of why the bank is bought out.

[River]

Originally Posted by djwilbanks

Generally a new bank buys them out, and you keep your loans and your cash... its just with a new bank.

It happened here when Liberty Bank bought out MidSouth Bank, I kept my checking account and all the money, just got a new bank name on my checks.

It's essentially the same thing regardless of why the bank is bought out.

It was a joke. Or at least I hope it was.

[djwilbanks]

Originally Posted by River

It was a joke. Or at least I hope it was.

I know it was... but someone might not have noticed...

Especially when the FDIC is forcing banks to sell because they can't do the very thing it was created to do...

[River]

Originally Posted by djwilbanks

I know it was... but someone might not have noticed...

Especially when the FDIC is forcing banks to sell because they can't do the very thing it was created to do...

Political factors and implications aside (please everyone!?), why aren't we just creating a Federal bank, from an economic(s) standpoint?

No, I'm not suggesting it. I, for one, don't know enough to suggest a solution and am self-aware enough to admit it. But academically, why not?

[Mercutio]

it was a rough day at the office.




I'm a stockbroker btw.

[Belzeebub]

goodluck geochem. Dang...Wachovia is my bank...now what do i do? f*ck...

[coldsteal2]

right now on TV they are talking about the Asian Markets
and the news people decided its too dangerous to
tell people how its going, that it could cause more panic
in the US.


UH..........Too late, "thanks for not warning us or anything"

[coldsteal2]

Oh crap........I just looked

the only country not in the red in the world is Norway

[Belzeebub]

i can just imagine trading in the Asian markets. Trading is already well on its way as we type and im curious to see what will be the outcome at the end of their day.

[geochem1st]

Wachovia was a bank that had over $700 billion in assets, and almost overnight, was sold for a paltry $2.2 billion. They are still trying to figure out how much of the assets were lost during the run... current estimate, around the water coolers. is around $10 - 16 billion in two days. Wall St. got wind of that and everyone started to dump Wachovia stock, amazing. Our debt from the mortgage side of the business was about $60 billion.

We had a solid core business with our retail bank. About two months ago we raised roughly $10 billion dollars in cash within 48 hours on a stock push, to keep on hand for emergency situations. As it was we were about 10% over the Federally mandated minimum for liquid capital on hand to fund losses. How quickly this all fell apart just kills me. I'm still in shock.

The other divisions of Wachovia were profitable as well, the Securities (AG Edwards merger), Commercial Investment Bank, and CMG - Wachovia Retirement Services (where I work). These are the divisions that make up the new 'smaller' Wachovia. Personally I feel safe at the moment job wise. Our new Wachovia is free of debt and technically no longer a 'bank'. We are a Financial Services company. If we can retain our customer base we should do well.

Citicorp got a real bargain. 3,000 or so brick and mortar bank branches, and conservatively $600 billion in assets, $65 billion in debt.... for $2.2 billion.... just because of the price of our stock??? Looking at it in black and white.. the math doesn't feel right. There is a major disconnect between our 'intrinsic value' and our perceived value. Besides the obvious of having bad mortgages on the books, it did not seem insurmountable, even if the economy worsened as forecasted.

Couldn't we have fought for one of the Federal Reserves lines of credit that were available? We had a solid underlying business. I'm just venting here but it just doesn't feel right. We had 'real' tangible value. All of us there felt it. There were quite a few people this morning with that 1000 yd stare.