Good news: Citigroup takes bailout money, buys new $50M corporate jet
posted at 1:20 pm on January 26, 2009 by Allahpundit
Citigroup decided to get its new wings two years ago, when the financial-services giant was flush with cash, but it still intends to take possession of the jet this year despite its current woes, the source said.
“Why should I help you when what you write will be used to the detriment of our company?” replied Bill McNamee, head of CitiFlight Inc., the subsidiary that manages Citigroup’s corporate fleet, when asked to comment about the new 7X.
“What relevance does it have but to hurt my company?”
It’s not uncommon for large companies to pay a deposit on a new plane then cancel the order before delivery, according to a source in the corporate aviation business.
Citigroup execs are also quietly trying to unload two of their older Dassault 900EXs.
No wonder they have no cash to lend; their capital’s all wrapped up in important expenses like this. Serious question: Do these turds want to survive, at least as private entities? Public support for the Big Three cratered when they were caught taking private jets down to D.C. for their first congressional hearing. They got their money anyway, of course, but letting companies like GM and Citi fail isn’t the only “punitive” option for an angry electorate anymore. After reading the Post piece on the jet, this passage from the Times story on nationalization tempted even my withered libertarian heart:
“The case for full nationalization is far stronger now than it was a few months ago,” said Adam S. Posen, the deputy director of the Peterson Institute for International Economics. “If you don’t own the majority, you don’t get to fire the management, to wipe out the shareholders, to declare that you are just going to take the losses and start over. It’s the mistake the Japanese made in the ’90s.”
“I would guess that sometime in the next few weeks, President Obama and Tim Geithner,” he said, referring to the nominee for Treasury secretary, “will have to come out and say, ‘It’s much worse than we thought,’ and just bite the bullet.”
Mind you, this is a company that’s already planning to cut 50,000 jobs. Exit question: How long before they have a change of heart on the jet? Over/under is a week.