‘Martha Wanted to Wash and Blow-dry the Chickens’Martha disrupts plans to make her seem like less of a perfectionist, Bear Stearns CEO Jimmy Cayne may face arrest (he’d better hide his stash!), and the FBI is slapping anyone who’s ever said the word “mortgage” with criminal charges, in our daily roundup of media, finance, real-estate and law news.
Layoffs at Citi? We’re hearing that layoffs at Citigroup began yesterday and are continuing today. No word yet on how many heads have rolled, but earlier reports suggested the numbers could reach 20,000, and our tipster says it’s a “bloodbath.” After the losses they reported earlier this week, this can’t have been a surprise to anyone at the bank. But here’s something that must have come as a shock: Citigroup was due to give out bonuses next week, and now we’re hearing those who were canned won’t get to partake. Representatives for Citibank said they’d call us back, but they haven’t yet, so … developing!
UPDATE: Ok, so it’s true: The first round of layoffs has begun. A Citigroup spokesman declined to comment specifically on the number of people laid off in New York or in any area, but during its earnings call this week the company indicated that in the fourth quarter, the bank would shed around 4200 employees worldwide. So far, those who’ve been sacked have been primarily in markets and banking. Regarding bonuses, Citi says that they’re scheduled to be doled out in the next week or so, but again wouldn’t comment specifically on if and how the newly unemployed would be affected. Some reports have said that company-wide, employees will receive stock instead of cash. Which, as someone but we can’t remember who pointed out, is kind of like Arby’s giving you a bunch of hamburgers instead of a paycheck.
Earlier: Vikram Pandit Gets a Write-down, Foreign Capital for His Birthday
white men with money
Vikram Pandit Gets a Write-down, Foreign Capital for His BirthdayYesterday was new Citigroup honcho Vikram Pandit’s 51st birthday, and pretty much everyone forgot, since this morning he had to announce the largest quarterly loss in his bank’s history. To be sure, the $18.1 billion subprime-mortgage-related write-down is not as much as the $24 billion that was predicted over the weekend, but it was enough that it led to a fourth-quarter loss of $9.83 billion. But there was a silver lining: The bank says it has plans to raise upwards of $12.5 billion through a private securities sale, which includes $6.88 billion from Singapore. They also expect the Kuwait Investment Authority, Alwaleed bin Talal, and even former Citigroup CEO Sanford “Sandy” Weill to kick in with investments. That’s “a huge vote of confidence on [Weill’s] part,” one analyst told Reuters. “I’m surprised to see his name there.” We wonder if Pandit is surprised. Maybe today after work, he’ll go outside and Weill will be waiting for him in his red convertible. “Me?” Pandit will say. “Yeah, you,” Weill will say, and later that night they’ll share kisses over birthday cake while the Thompson Twins’ “If You Were Here” plays softly in the background.
Citigroup raising $14.5 billion [Reuters]
intel
New Year’s Resolutions for the Best New YorkersRecently, we were watching John Waters’s 1998 movie Pecker, which starred all kinds of great people like Martha Plimpton and Lily Taylor and Edward Furlong, before he got weird and started getting arrested and dating his manager. Anyway, as in all John Waters movies, there were about five really brilliantly funny parts in it, one of which was a game the characters played called “Shopping for Others,” in which they’d go to the supermarket and sneak things into the shopping carts of fellow shoppers when they weren’t looking. (Like a long phallic gourd in the cart of a mousy single woman or a stack of Depends for a smarmy dude in tight jeans, etc.) Anyway, we got to thinking: How about if, this year, we make New Year’s resolutions for others? We’ve never made New Year’s resolutions ourselves — it’s weird, every year New Year’s Eve rolls around, and we realize we’re still kind of perfect! — but we’ve always felt we were missing out on that great American tradition. Not to mention, frankly, there are people that could use our assistance. So. To celebrate the great New Yorkers who make this blog possible and to help them continue their gloriousness into 2008, we’ve generously ginned up some resolutions for their benefit.
it happened this week
Alone in the CrowdNew Yorkers watching Will Smith walk through the ruins of an uninhabited Manhattan onscreen in I Am Legend knew just how he felt; it was a week for contemplating loneliness. Rudy Giuliani, indulging in fantasy population control of his own, envisaged a city in which he’d deported 400,000 illegal aliens. (“I would have had fewer problems,” he’s quoted as saying in a new book.)
company town
Some Lawyers Are SadLAW
• Know a troubled lawyer? If you work in the law, you probably do — some estimates put the ratio of depressed attorneys at 20 percent — and a few new Websites are trying help them out. [Law Blog/WSJ, WSJ]
• How not to get out of your marijuana arrest: When the judge lets you off easy, pull out a driver’s license covered in pot. [New York Law Journal]
• So just how lame was Cadwalader’s Wild Wild West holiday party last night? Wildly. [Above the Law]
white men with money
Vikram Pandit Will Always Be Daddy’s Little BoySome finance pundits may be giving newly installed Citigroup CEO Vikram Pandit a hard time, but there’s one person who knows he can get the job done: his dad. “I am not apprehensive about his abilities,” Shankar Pandit, 84, told the Times of India last night. “I am confident he will do a very good job.” In his interview with the Times, Shankar, the former director of a pharmaceuticals company, talked about getting the phone call from Vikram about his promotion (“He told me in a calm but happy voice that everything had gone well”) and what Pandit was like growing up (“He was a brilliant boy. In school, he always stood first in his class”) and gave some insight into the man Vikram is now.
He is a very simple person at heart. He likes reading and reads on all sorts of topics; he even reads up a cookery book! He is a very good photographer and enjoys being with family. He derives pleasures from simple things in life, not playing golf etc.
Again with the golf! Apparently, during the months following CEO Chuck Prince’s departure from Citi, Pandit discussed the possibility that he might get the Citigroup job with his father. Like an Indian Fred McMurray, his dad told him that although he hoped he would, but he would still be proud of him if he didn’t. “I told him he was only 50 years old and had enough time ahead of him to prove his worth,” he said. Aw. Even Wall Street titans are just little kids to someone.
Vikram Has To Put In A Lot of Efforts, Says Dad [Times of India]
Earlier: Daily Intel’s Coverage of Vikram Pandit
it just happened
Vikram Pandit Is the New CEO of Citigroup!Poor Vikram Pandit! He’s been on the Citigroup throne for only a few hours, and already everyone is raining on his parade. “There was some hope that somebody with a bigger name would be chosen, so maybe from that perspective there is some disappointment,” Lee Delaporte, director of research at Dreman Value Management, told Reuters. Business Week, along with everyone else, took it upon themselves to elucidate just how much this job sucks, and CNN called his résumé “flimsy.” Well, at the very least, they know he’s not going to pull a Jimmy Cayne. “I don’t play golf. Period,” Pandit told New York in 2002. “I’m sure I’d enjoy it, but I just never got good at it.” But what do we really know about Vikram Pandit? After the jump, the salient facts of the 50-year-old CEO’s life.
company town
Pandit and Willumstad to Share the Ultimate Power?FINANCE
• The newest Citigroup rumors suggest a “tag team at the top”: Financial whiz Vikram Pandit will take over as CEO, while the more socially astute Robert Willumstad handles chairman duties. We’re just not sure “tag team” means the same thing for us as it does the Times? [DealBook/NYT]
• Morgan Stanley issued a full recession alert for the U.S. economy today in the oh-so-subtly titled “Recession Coming.” Meanwhile, a recent Journal poll of top economists puts the risk of recession at 38 percent. [Telegraph, WSJ]
• Thirtysomething Blackstone real-estate guru Jonathan Gray is getting rather comfortable in the top tier of the young establishment. [DealBook/NYT]
company town
Gucci Would Prefer a More Flattering CutFASHION
• The Gucci family is up in arms over Ridley Scott’s biopic. They fear he’ll focus on the family scandals. You know, instead of making a movie about all the boring stuff. [British Vogue]
• Helmut Lang is opening a pop-up shop in the meatpacking district. Just what we need, another fabulous place to spend our money while we are drunk. [Fashion Informer]
• Kaiser Karl rocked the U.K. with a Chanel fashion show. [WWD]
company town
Karl Rove to Finally Profit From Professional Secret-KeepingMEDIA
• Here come the NBC News pay cuts: Jeff Zucker plans to slash anywhere between $20 and $40 million, including an entire level of MSNBC management. And thanks to the writers’ strike and fears of recession, future cuts may only get worse. [NYP]
• Karl Rove may be offered $3 million for a memoir, in which we may find out how much he got in exchange for his soul. [NYP]
• At least one person thinks the press did a heckuva job in reporting the lead-up to the Iraq war — former top White House communications adviser Dan Bartlett. [NYO]
company town
Jon Stewart Suddenly Not Looking Like the Nice GuyMEDIA
• Is Jon Stewart really the only late-night host not currently covering the salaries of his laid-off, non-striking employees? [Mixed Media/Portfolio]
• The key lines from the n+1 essay that helped convinced Choire Sicha and Emily Gould to quit: “The purpose of Gawker Media was always to improve on the print publishing business model. It was never, as the content of Gawker sometimes seemed to suggest, to produce critiques of the waste that model created. The content at Gawker, like most Condé Nast titles, is a service to the advertisers. … You could say that as Gawker Media grew, from Gawker’s success, Gawker outlived the conditions for its existence.” Joshua David Stein announced his own departure, due mostly to personal loyalty, on Saturday. [n+1, Media Mob/NYO]
• Meanwhile, Portfolio’s Jeff Bercovici proves that Condé and Gawker really are at the same level: “By the way, those who feel wronged by Gawker over the years can take some satisfaction in the uniquely terrible timing of the walkout for Denton, who is pumped full of painkillers after a recent back injury. Last week, the pain became so intense he needed an ambulance to get to the hospital. As he was being loaded into the ambulance, he says, his greatest fear was that he would be spotted by someone from Gawker, which is headquartered just down the block from his home.” [Mixed Media/Portfolio]
company town
Stephen Colbert Backlash: The Fall’s Hottest TrendMEDIA
• The American version of the Guardian hits our shores! [Guardian via Gawker]
• Stephen Colbert is leading Bill Richardson, Dennis Kucinich, and Mike Gravel in national polls; the media backlash has already begun. [WP, HuffPo, Gawker]
• ASME announced the finalists for the 2007 best magazine cover. They must have missed the backlash memo: Colbert is featured three times, more than any other star. [ASME]
white men with money
Citibank Shake-up Shakes Out for Vikram PanditGuess we know why Citigroup’s Vikram Pandit felt okay about buying that fancy $17.6 million apartment in the Beresford! Dude just got a promotion. Last night, embattled CEO Chuck Prince announced he was consolidating its investment-banking and alternative-investment groups and appointing Pandit as the king of both of them. Though Pandit has a reputation for being “calm,” “selfless,” and “not prone to ruthless acts,” as the Times puts it, the guys who were slated to be underneath him are none too pleased. Already two executives, Thomas Maheras and Randy Barker, have decided to leave the bank. Meanwhile, some people are wondering if Prince’s appointment of Pandit means that he’s going to resign? Deutsche Bank’s Mike Mayo thinks he should. But former Secretary of the Treasury Robert E. Rubin bet the Times $100 that Prince will have his job next year. And you know how much $100 is worth on Wall Street these days.
Big Shake-Up As CitiGroup Combines Two Units [NYT]
Citibank Cut to Sell By Deutsche Bank on Governance [Bloomberg]
real estate porn
It’s Good to Be Vikram Pandit
(To be read in the voice of Robin Leach.)
Vikram Pandit, Citigroup’s newish head of alternative investments, is apparently not so bothered that CAI profit has dropped 40 percent since he started with the division, or that the Old Lane hedge fund he sold them for around $800 million dropped 5.9 percent last month. He’s just plunked down $17.9 million for Tony Randall’s apartment in Central Park West’s Beresford Building, a ten-room spread that occupies an entire floor. According to the listing, it is a “truly superb residence,” with “superb light,” “impressive park views,” herringbone wood floors, a fireplace, coffered ceilings, a butler’s pantry, wine storage, and a private elevator. But none of that matters to Pandit, who told New York earlier this year that he never got into “the Gordon Gekko idea of Wall Street.” He just really, really loved The Odd Couple.
Citigroup’s Pandit Buys Tony Randall Co-Op for $17.9 Million [Bloomberg]
Related:
•Vikram Pandit Will Always Be Daddy’s Little Boy [12/13/07]
•Vikram Pandit is the New CEO of Citigroup! [12/11/07]
•Citigroup Shakeup Shakes Out For Pandit; [10/12/07]