Wall Street Folly

Citigroup Inc. Chief Executive Officer Vikram Pandit plans to tell U.S. taxpayers he’s grateful for the $45 billion bailout that helped stave off a deposit run at the bank in 2008, a person close to the company said.

Pandit, scheduled to appear in Washington today before a panel overseeing the bank-bailout program, will acknowledge that the infusion stabilized Citigroup, said the person, who requested anonymity because the planned testimony isn’t public. Pandit will thank the government for providing the money, the person said……

Citigroup Inc. Chief Executive Vikram Pandit will be in an uncomfortably familiar position Thursday when he testifies to the congressional panel in charge of overseeing the U.S. government’s rescue of battered financial firms.

The New York company still has $25 billion in money from the U.S. Treasury, which owns a 27% stake that makes some lawmakers leery about taxpayer exposure to the financial giant.

A spokesman for the panel said Mr. Pandit will be prodded about whether Citigroup executives are running the company in any way that assumes an implicit government backstop, as well as signs that Citigroup is “getting credit flowing.”….

President Barack Obama sent Congress proposed legislation on the so-called Volcker Rule that would ban banks from hazardous trading and impose limits on how large they can grow.

The five-page plan released today seeks to prohibit lenders from trading solely for their own profit and to stop them from grabbing more than 10 percent of the total liabilities in the banking system through acquisitions. The measure instructs regulators to block mergers that would put bank market share over the limit, unless they are acquiring a failing bank with approval from regulators….

….The world’s No. 1 investment bank in 2009 was JPMorgan Chase & Co., which took in $4.97 billion, a 16 percent increase over 2008, when it was also the leader. JPMorgan was also No. 1 in fees from equity and debt sales. Goldman Sachs Group Inc. was No. 2 in total fees and No. 1 in mergers and acquisitions, having advised drugmaker Schering-Plough Corp. on its completed $47 billion sale to Merck & Co., among other transactions.

“JPMorgan and Goldman Sachs have the field to themselves because they’ve emerged as the victors, at least in clients’ perceptions,” says Bruce Foerster, president of Miami-based advisory firm South Beach Capital Markets…..

Rep. Charles Rangel yesterday stepped down under pressure as chairman of the House Ways and Means Committee, trying to remove himself as an election-year symbol of corruption that could doom Democrats at the polls.

Rangel said his departure was temporary, although most observers believe he will never return. The Harlem Democrat’s move came as momentum had been building behind a Republican push to topple him following an Ethics Committee admonishment last week for taking corporate-sponsored junkets.

Nervous Democrats across the country had encountered fierce criticism for supporting Rangel and accepting “tainted” campaign cash from his political committee…..

Lee Sachs, a counselor to Treasury Secretary Timothy F. Geithner, plans to step down this year as the banking crisis wanes and the Obama administration winds down its emergency programs.

As an adviser on domestic finance, Sachs helped conduct stress tests on the biggest banks and reshape the $700 billion bailout. He also helped manage trillions of dollars in additional government borrowing and advised Geithner on the market implications of issues from the Greek budget crisis to housing finance.

Sachs says he’s leaving now that markets have stabilized and Geithner has had time to set up a permanent team. “I came back down here to help the president and secretary to design and execute their response to the financial crisis,” he said in an interview. “The financial system is in a much stronger position today than it was a year ago.”….

Nissan to Recall Over 500,000 Cars - Wall Street Journal

Nissan Motor Co. on Wednesday said it will recall 539,864 trucks, sport-utility vehicles and minivans in North America and some Asian and European markets because of problems with brake-pedal pins and fuel gauges.

The announcement follows its recall last week of 76,415 vehicles in Japan because of issues with electric cables connected to the engines and comes on the heels of General Motors Co.’s recall Tuesday of 1.3 million compact cars with suspect power steering…..

Tags: Autos, bailout, Barack Obama, Charlie Rangel, Citigroup, Ethlly challenged politicians, Fees, Goldman Sachs, JP Morgan, Nissan, Politics, recalls, TARP, Tim Geithner, U.S.. Treasury, Vikram Pandit