So has your local bank announced an infusion by the Treasury yet? No? Then the Treasury might not think it is going to survive the crisis. That’s how the New York Times plays it, anyhow. There is a certain bitter smell to the article. I strongly suspect that some of the people involved in the piece over at the New York Times were, long ago, left standing in line after the list of the people picked for the baseball team was read.
But, you know, there are other reasons your bank might not have rushed out a press release. Perhaps they just don’t like the terms the Treasury has to offer, and now they have to spend the rest of the month explaining that no, they did qualify, but they just chose not to take the money. Good luck with that, guys. Let us know how it goes.
Which Banks Won’t Make Henry Paulson’s Cut? [The New York Times]
The Nine
In a move which makes it difficult to determine if the government is emulating the Europeans or Warren Buffett (we like the Buffett angle much better) the government (we read this as “The Treasury”) is poised to slup up preferred shares in “nine top financial institutions.” Bad jokes about canceled ABC prime time programs aside, it will be interesting to see who the government thinks “The Nine” are. Is that a ringing endorsement, or a scarlet letter? What happened in there? (By which I mean, that smokey back room in the Treasury building). Will The Nine share some special, secret bond that is now totally inaccessible to other players in the market? (Oh, the pain of selling preferred, you could never understand- sorry, I want a divorce).
I suppose the alternative, as a victim of compelled preferred share issuance, is living through the horror that was giving in to the advances of Japanese bank executives. And after all that, you don’t even get a cigarette or the Good Housekeeping seal from the Treasury. I feel so dirty.
Update: “The Nine” = Citigroup Inc., Wells Fargo & Co., JPMorgan Chase & Co., Bank of America Corp., Goldman Sachs Group Inc., Morgan Stanley, State Street Corp., Bank of New York Mellon Corp., and Merrill Lynch & Co.
U.S. Set to Buy Preferred Stock in Nine Top Banks [The Wall Street Journal]
U.S. Said to Invest in Citigroup, Goldman, Bank of America [Bloomberg]
