Citigroup & Bank of America fall further, get bailed out further

Working in the banking field has been tough this week as bank stocks across the market have been hammered. Why? Primarily because of announcements out of Citigroup and Bank of America which underline how much risk they have gobbled up, and how poorly they have managed as they have acquired small bank after small bank. Citigroup has actually been split this week into two different companies - albeit still under the Citigroup umbrella of management - one of which is likely to be allowed to fail in the next six months. Both banks have also accepted large new sums of capital from the government, making the U.S. government primary shareholders in these companies.

Have we crossed the Rubicon here, on the weekend between presidencies, at a time when Bush is no longer president but Obama has not yet taken on the mantle? This looks and smells just like complete nationalization of the banking system, something our Founding Fathers (and Mothers) were absolutely against and which has lead Europe into a malaise which has kept unemployment high and growth low for decades. The timing of this move is suspicious as it gives all politicians the excuse of not having been in charge when it happened, thus there being no accountability for such a fundamental change to our economic system.

As a bank employee, I am happy to see it as a potential bringer of stability to an unstable market. As an American, I am sad to see it, as it may be the beginning of an era of extreme governmental intrusion and limitation of personal liberties.