Opening Bell: 11.14.08


Citi Could Seek 25% Reduction In Workforce (NYT)
While the WSJ is claming that Citi is seeking a workforce of around 290,000 and making the necessary cuts to reach it, the Times has gone one step further by suggesting that they could cut another 25% off the workforce putting the number at 264,000.
"Citi doesn't have a credible management team, they don't have a credible board," said Christopher Whalen, managing partner at Institutional Risk Analytics. "If you look at their loss rate, it is almost inevitable that Citi is going to be asking the government for more money next year."
Speculative Energy Traders Buy $30 Feb Puts (Bloomberg)
"Trades in crude-oil options contracts that would allow the holder to sell oil for February delivery at $30 a barrel reached 1,407 on the New York Mercantile Exchange yesterday, making the contract the day's second-most active, exchange data show."
Putin Seeks Changes In Laws To Return To Power (AP)
Lawmakers in Russia are changing legislation so that Presidential terms last for six years, instead of four. While this doesn't open the possibility that Putin could return for a third term, there could be room to interpret the law in such a manner that one could argue Putin didn't get to serve his full Presidency.
Paulson Backs GM Bailout, But Not From His Bank Loot (CNBC)
Paulson is of the opinion that the automotives need to be stabilized, but only so long as there's a long term plan in place (like buying the debt from banks).
Of note:
"He stopped short of saying the companies do not have viable strategies to survive on their own, but said, "You've got to ask that question of any company that might be on the brink of failure.""
Merril Advisors Take BofA Offer (Reuters)
Through some friends in Retail, it's my understanding that they didn't take the offer so much as it was forced upon them. While everyone is aware of the litigation clause that Advisors sign it had been rarely enforced, but with firms desperately clinging to assets, it appears as if the gentleman's agreement in place has been replaced by hard line tactics.
Brits Drinking Less Beer? (Bloomberg)
The recession has unintended consequences: beer consumption is down. But, says Bloomberg, Liquor sales are up about 2%. What we're seeing here is a marked shift from the more expensive night out at the pub to the less expensive pint of whiskey at your house, which is also leading to an average of 5 pub closures a day.
I'm starting to wonder if this phenomenon is going to spread to the city; I can see where bottle service is out - but stop going to bars all together? I just can't see it.
--William Richards