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As a holder of Senior Notes Citibank, in theory and practice, could be paid-off in full with the other subordinate debt holders get the shaft.

All depends on the Bankruptcy work-out.

by ATinNM on Mon Sep 15th, 2008 at 12:18:22 PM EST
[ Parent ]
Right.

However, the other debt is small enough that "getting the shaft" is unlikely to topple the others. It's the $138bn figure that stands out.

A vivid image of what should exist acts as a surrogate for reality. Pursuit of the image then prevents pursuit of the reality -- John K. Galbraith

by Migeru (migeru at eurotrib dot com) on Mon Sep 15th, 2008 at 12:25:35 PM EST
[ Parent ]
Need to look at and see how much of these assets© are generating positive Cash Flow.  Right now Balance Sheet Accounting is meaningless.  Nobody knows what that shit is worth.  As long as Net Income is positive Citi can stay in business.

At least until they have to do some debt roll-over.

Then ... who knows?

by ATinNM on Mon Sep 15th, 2008 at 12:38:27 PM EST
[ Parent ]
Could be that this was what much of the credit default swap two hour special session on Sunday was about.

As the Dutch said while fighting the Spanish: "It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Mon Sep 15th, 2008 at 01:03:57 PM EST
[ Parent ]
not to mention 12 USC 17. LEH is a financial holding company rather than national charter bank or bank holding company. Some unusual considerations, mmm hmm, will apply.

Diversity is the key to economic and political evolution.
by Cat on Mon Sep 15th, 2008 at 12:50:55 PM EST
[ Parent ]
Can you give a quick explanation? (For those of us who don't want to search through pages of the US legal code...)
by ThatBritGuy (thatbritguy (at) googlemail.com) on Mon Sep 15th, 2008 at 05:17:44 PM EST
[ Parent ]
Gracious! I think that's a diary. For one, the FRB is the principal regulator of financial and bank holding companies; Paulson abets Bernanke evidently to circumvent SEC jurisdiction and prosecution; and case law allows corps plenty latitude in dispositions.

That's what I mean by "unusual consideration." I'll give it --facts available to the public-- some thought, then report.

Diversity is the key to economic and political evolution.

by Cat on Mon Sep 15th, 2008 at 07:21:56 PM EST
[ Parent ]
MT is apparently still living with the idea that our elite economic players operate within the laws that little shits like all of us operate within.

Conservatives want live babies so they can raise them to be dead soldiers. - George Carlin
by Drew J Jones (myfriends@thisispancakes.com) on Mon Sep 15th, 2008 at 09:25:45 PM EST
[ Parent ]
LOL. No. I'm merely wanting to be helpful by offering some kind of explanation as to how US arrived at the current predicament. The law (USC) is a document trail if nothing else, and it leads straight to "our" bipartisan Congress.

Frankly, not Bush. Sorry, that freak is a "comma" in the scheme. The electorate will continue to seat their hoary jackasses despite it all and expecting somehow a different result ...

Diversity is the key to economic and political evolution.

by Cat on Wed Sep 17th, 2008 at 02:58:42 PM EST
[ Parent ]

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