Word: stockely
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...issue with Citi is the degree to which the downtrend in its stock price affects fundamental factors, as seen with other financial firms over the past few months," Mayo wrote in the report...
...company's board members reportedly met on Friday and will continue to talk over the weekend to discuss the firm's options. There are a number of possible outcomes, not all of which conclude with the end of Citi. "Somehow they need to get the price of their stock up," says James Ellman, a hedge fund manager at Seacliff Capital. "If they don't they are in for a lot of big problems...
...avoid the fate of Lehman or Bear, the firm's board may feel like it needs to do something to boost it's stock price. One option would be to boot chief executive Vikram Pandit. Some on Wall Street believe Pandit has not been quick enough to react to the problems of the firm and could still be in denial. On Friday, Pandit told top executives that he doesn't believe Citi needs to sell off parts of its business to raise capital. Investors don't seem to agree. The stock fell on the news...
...Next, the government could suspend trading in the credit default swaps on Citigroup's debt. The price of those contracts, which pay out if Citi goes bankrupt, have been rising recently, and that is spooking the stock investors. Without that constant reminder of the increasing chance of Citi going out of business, some observers say the stock would rise...
...Citi has already asked the government to restrict short-selling (where investors borrow stock in hopes that the price will fall) in its shares. Executives hope that getting rid of the people rooting for the firm's demise could relieve some pressure on the company's shares. What's more, to close their positions, short sellers would have to buy the shares they borrowed...