Tuesday, November 27, 2007

And it begins

The carnage of the obvious ponzi scheme that was the sub-prime mortgage fiasco is starting to have an effect, not just on those who are losing homes, but on the people who work for the lenders who manipulated the whole thing.
Citigroup, the No. 1 U.S. bank by assets, is planning major job cuts over the coming months, CNBC television reported on Monday.

CNBC said that no exact number had yet been set, though some jobs were already being eliminated. It estimated that the cuts could total anywhere between 17,000 and 45,000.

Mike Hanretta, a spokesman for Citi, declined to comment.

Any layoffs would come as Citi wrestles with asset writedowns and looks for a new chief executive officer. Former CEO Charles Prince resigned on November 4, the same day Citi said it may write off this quarter $11 billion of assets linked to subprime mortgages.

Citi said in April that it would eliminate 17,000 jobs as part of a broad restructuring designed to cut costs, which at the time was about 5 percent of its work force.

Having already laid off 17,000, CitiGroup is looking at dumping at least 17,000 more.

When Charles Prince resigned he walked away with a $40 million severance package - for incurring massive losses.

Milton Friedman would be so proud.

H/T Brilliant At Breakfast

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