I don’t think it is fully understood among my old colleagues that it is a new day on Wall Street. The beat they once covered no longer exists.
Citigroup may look the same, but, Audit readers, it is now a ward of the state, a welfare case.
It is one of three banks to receive $25 billion from the U.S. government, which bought preferred shares only because no one else would.
The other two banks that got that much, Wells Fargo, and JP Morgan Chase, didn’t need it as badly, as this stock chart plainly shows.
And unlike most welfare cases, Citigroup is distinctly undeserving. As we’ve written elsewhere, courageous reporting in the alternative press earlier in the decade demonstrated that Citigroup led the mainstreaming of subprime lending, principally through its CitiFinancial unit, a successor to the notorious Associates First Capital, which Citi bought in 2000. Indeed, it is doubtful that any bank had a more extensive conveyor belt running from subprime mortgage to substandard CDO than Citi.
Krawcheck’s career at Citi, from 2002 to 2008, pretty much coincides with the planting of the seeds of destruction that Citi is currently wreaking on its shareholders, its borrowers, its CDO-buying pension-fund clients, and the world at large. Was it her fault? No. But she was a senior executive, the CFO, for pity’s sake.
It seems to me that Wall Street’s new era would give rise to a more assertive, accountability-oriented culture among the financial press. I see signs of it, but this piece feels very August 2008.
Oh, I forgot to mention one more bit of info, in the last paragraph of the Times piece, that Krawcheck would like to get across, apparently:
Ever restless, she’s also hesitant to stay on the sidelines. From her apartment in Manhattan, where she lives with her husband, a fund manager, and their teenage son and daughter, she is putting out feelers, looking for another job in wealth management.
HAR!
Posted by edward ericson on Thu 20 Nov 2008 at 08:55 PM
I really take exception to this criticism.
This is a damn good story.
Geraldine Fabrikant is no rank amateur: she's one of the toughest reporters in the business & I really don't have a problem with the sourcing.
Don't know how much experience the CJR critic has as a business & financial journalist -- or doing any kind of journalism where sources are just not going to stick their heads out of a foxhole -- but the important thing is to get the story.
It's clear that no one on either side of the controversy wants to talk on the record. I'm sure that there are numerous, serious legal issues involving employment law,confidentiality agreements, etc.
Now I'll tell a quick story.
Thirty years ago, when I was a reporter at the El Paso (Tex.) Times, I was sitting at a local cafe across the street from the newspaper with Alan Riding, then the Mexico City bureau chief who was in town working on a story on the border region.
And my city editor, may he rest in peace, came by & managed to complain to Riding about the use of unidentified sources.
And I recall Riding, who had covered the Sandinista revolution in Central America, among other high-profile stories of the day, remarked:
"If there's a shipment of guns going to a certain town, it's the information about the gun shipment that's important, isn't it?...If the information is good, do you have to cite the source and get him shot?"
As for a Jewish & Protestant background in the South, that can indeed be an odd combination & can produce someone with greater sensitivities and social skills than, say, The Lady from Boston, who said famously: "Why should I travel? I'm from Boston."
With Barack Obama -- as well as with Sen. John McCain -- we see the importance of identity and character.
Why should it be different in a high-powered business executive?
There is plenty of room for criticism in the coverage of Wall Street & the world of finance. But there's nothing wrong with this story: Ms. Fabrikant tells us where the gun shipment is going.
Posted by Paul Sweeney on Fri 21 Nov 2008 at 01:13 AM
This part (After she leapt into Wall Street’s upper ranks, however, some of her appetites might have outpaced her abilities. When she first arrived at Citigroup, she oversaw an area with which she had deep familiarity — the brokerage business. But just two years later, Mr. Prince, Mr. Weill’s heir, promoted her to a substantially more complex job, chief financial officer.
Many analysts came to believe that Ms. Krawcheck did not handle that post well, especially after the bank began posting titanic losses and suffering downturns in some of its key businesses.) sounds like "The Peter Principle" is still with us.
Posted by alfred brewer on Fri 21 Nov 2008 at 05:28 PM