Your Tax Dollars under TARP were supposed to be used as credit given to boost the US economy not loan money to foreign nations.
Kucinich observed that Citigroup, Bank of America and J.P. Morgan – which have accepted a combined $120 billion from the government under the Troubled Assets Relief Program – recently made investments of more than $1 billion in Dubai, China and India. He questioned the wisdom of sending money abroad when the U.S. economy is in disarray.
“How does a multibillion financing deal to Dubai ease the liquidity crisis in the United States of America?” Kucinich inquired at a subcommittee hearing. “What about other kinds of uses of funds: corporate spending on lavish parties, the continuation of contractual agreements to pay for naming rights on professional sports stadiums, corporate sporting event sponsorships?”
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Citigroup Executives Gain $2.2 Million in Stock Bets
Four Citigroup Inc. executives who bought the bank’s stock last week generated a $2.2 million paper profit within nine days, regulatory filings show.
The executives, including director Roberto Hernandez, benefited as the company’s stock climbed 47 percent from March 10 through yesterday’s close of markets, after Chief Executive Officer Vikram Pandit said in a memo that the bank is having the best quarter since 2007. Their buying spree was the first by bank insiders since Jan. 14, filings show.
“You’re supposed to buy when everyone else is selling,” said Bruce Foerster, a former Lehman Brothers Holdings Inc. managing director who now runs South Beach Capital Markets in Miami. Banks have internal systems to monitor executive trades and prevent abuses, he said.
Pandit wrote in the internal memo March 10 that the company was profitable in January and February, leaving him “encouraged with the strength of our business so far in 2009.” The comments triggered Citigroup’s biggest one-day percentage gain since Nov. 24, spurring global markets.
The stock had tumbled 95 percent in the previous year amid five straight quarters of losses and three government rescue attempts since October. The plunge has slashed the value of investments by the bank’s own employees, including some of the executives who purchased shares last week.
Shannon Bell, a spokeswoman for New York-based Citigroup, declined to comment on the trades.
Hernandez bought 6 million shares on March 2 at an average price of $1.25 apiece, regulatory filings show. The stock, which touched a record low price of 97 cents on March 5, closed at $1.52 in New York Stock Exchange composite trading yesterday, giving him a paper profit of $1.7 million.
Latin America Chief Executive Officer Manuel Medina-Mora bought 1.5 million shares on March 3 at an average price of $1.24, regulatory filings show. Other buyers last week included Vice Chairman Lewis Kaden with 100,000 shares and Controller John Gerspach with 65,000.
The shares slipped 1 cent to $1.53 as of 10:37 a.m., cutting the executives’ paper gains by $77,000.
Hernandez said last month he will step down from the board after Citigroup’s annual meeting in April. He plans to keep his role as non-executive chairman of the company’s Mexican bank, Banamex. Hernandez also has an interest in a Mexican mutual fund that owns 14.6 million Citigroup shares, the filings show.