How the banks were dismantled.

Here is an article on the value of Citibank:

http://seekingalpha.com/article/160007-citigroup-a-simple-analysis-of-a-terribly-complex-company?source=email

And here is a description by blogger "Tack" of what happened to the bank stocks:

You have hit the nail on the head, one that has eluded so many observers, misled by the ridiculous mark-to-market values, which, of course, are near meaningless for bank loan portfolios that are being held for performance, not as speculative-gain assets. The current mark-to-market values, so frequently cited by the "insolvent" crowd, bear almost no resemblance to the discounted-cashflow values typically used banks and other financial firms to value debt portfolio assets.The above explains why banks are making record cashflows and amassing record cash balances -- lots of that "valueless," "toxic" debt is actually performing nicely and throwing off cashflows, month after month. It, also, explains why no bank is in the slighest interested to jettison absurdly-marked loans at giveaway prices, so that some drooling speculators can make all the gains on the writeups after the hysteria passes (it's passing, now, by the way).Huge lobbying efforts were expended by the speculator class to inspire Congress to pass laws making it mandatory for banks to sell their assets at ruinous prices, but, thankfully, these efforts have failed, so far (and let's hope, forever). If this had occurred, we would have seen the complete ruination of the banking system and utter destruction of the economy, with an accompanying depression of incalculable magnitude.Related to the foregoing, the same speculator class caused most of this crisis by taking what could have been a manageable subprime-loan problem and turning into an economic rout by playing a rigged game of shorting (much of it illegal naked shorting) debt indices, while at the same time buying huge CDS positions on the institutions holding the debts, know full well that the then-current mark-to-market rules would ensure financial catastrophy for the banks and other lenders.So many observers/commenters seem to think that the writedown, selloff, paper-insolvency stage was/is the real world and that the current recovery is false, but they have it exactly backwards. The banks, mistakes though they made with poor loans (aided and abetted by Barney Frank/Christopher Dodd lending mandates), have been the victims of a scurrilous campaign of manipulation and profiteering. It is only now that they are regaining some semblance of normal operation, and even now, they have a long way to go to regain full economic and stock-market value.On Sep 05 11:38 AM stonebluff wrote:> Beware of assuming that mark to market should be a mantra. When the> Fed racked interest rates up to 20% in the early 80's, probably every> commercial bank in the US was broke bcause of depreciation in its> assets. A bank of which I was a director was under water because> of depreciation in its impeccable loan portfolio alone.. The regulators> and bankers very sensibly ignored the mess. They have to have that> flexibility.> > An analysis of book value that is made based on intangibles based> on what every credit trainee is taught not to do.