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Tuesday, November 27, 2007

And this is only the beginning
Posted by Jill | 7:15 AM
While former Citigroup chairman Charles Prince got a $40 million severance package for mismanaging the company in subprime mania and billions of dollars in losses, up to 45,000 more employees of the financial services giant may be paying a higher price -- their jobs:

Thousands of jobs could go at Citigroup (NYSE:C) as part of the bank's cost-cutting programme aimed at rebalancing its books after having to write down 16.9 bln usd worth of subprime assets, the Telegraph says without citing sources.

The cuts could eclipse those made by the bank in April, when then CEO Charles Prince said that he would slash 17,000 jobs.

The bank did not confirm job cuts, but did say it was looking at ways of saving cash.

'We are engaged in a planning process in anticipation of our new CEO, and our business heads are planning ways in which we can be more efficient and cost-effective to position our businesses in line with economic realities. Any reports on specific numbers are not factual,' the paper was told.

You know as well as I do that it isn't top executives -- those who actually make the decisions -- who will pay the price, other than a few hundred million less in bonus money this year. But when you consider the amount of money lost in this mortgage disaster, these 45,000 likely layoffs at Citigroup are only the beginning. That's 45,000 more people pounding the pavement looking for jobs that will be next to impossible to find because every other company that might hire them will be cutting back as well. So they'll be looking for whatever work they can scrounge up in the retail and service industries where the only real job growth in the Bush years has taken place -- eventually joining the very undocumented immigrants the Republicans have told them to look at in an ever-faster race to the socioeconomic bottom.

This is capitalism in America. Mission accomplished.

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