This morning there are numerous stories documenting the mounting problems at Citigoup .Here's an example from the paper of record Shares Falling, Citigroup Talks to Government .
So the mighty Citi is in trouble and company top dogs are "entered into talks with federal officials about how to stabilize the struggling financial giant. "
Screw Citigroup , Sandy Weill and Chuck Prince!
I did my Saturday Post Office run and pulled an official looking document with a Citi logo on the envelope out of my PO Box ( I do have a Citi MasterCard). Amazing! This is what the letter from Citi said:
1) We are changing how we calculate your variable APR for purchases:
We are increasing your variable APR for purchases . Your purchase APR will equal the
US Prime Rate plus 8.99% with a minimum APR of 14.99%. As of October 1,2008 this purchase APR is 14.99%.
2) We are changing how we calculate your variable APR for cash advances:
We are increasing you variable APR for cash advances. Your cash advance
APR will equal
the US Prime Rate plus 16.99% with a minimum APR of 21.99%. As of October 1,2008 this cash advance APR is 21.99%.
Number 3 had something to do with what they call a Default APR. I'm not sure that that is but this was the bottom line.
The default APR equals the greater of 1) the Prime Rate plus up to 23.99% or 2) up to 29.99%
If I understand this properly they can charge me almost 30% for the right to borrow money from them. There is a word in the English language called usury. Some consider it a sin. It's good to know that our government is considering helping Citi get out of their financial mess. I think they should just die.