Citibank Cuts

Not all the jobs cuts announced at Citigroup this morning will be outright layoffs. Like all inept managers the Vikram Pandit team has sought to obfuscate as much as possible on that figure. Here is the New York Time’s coverage:Citi Plans Asset Sales and Job Cuts

The damage will be felt most here in New York and then in London. Those asset sales are a veil. The new owners, if someone can be found for the assets, will inevitably shrink the workforce as a way of recouping whatever premium they paid to acquire the assets. So Pandit trying to make nice with his employees is merely displaying the lack of courage that we have now come to expect from the financial sector’s managers. These are the fools who acquired the assets, who staffed their empires and who reaped the benefits. Now they are trying to cover for the years of abysmal intellectual and management failure that culminated in the recent Wall Street meltdown.

OK, so Pandit wasn’t at Citi when it was empire building, but his last year has been one of caution and stutter rather than courage or fortitude. He has dodged rather than stood tall. The employees are always the ones who pay for senior management’s foolishness, error, terpitude, or hubris. That seems a timeless characteristic of our economy.

And the spill over into New York City will be huge. With the financial services sector in a tailspin, the entire city will suffer through 2009 and well into 2010. The boom times are over.

Thanks guys.