I was listening to the radio today where they were interviewing people at a IndyMac bank in CA waiting in line to get their money out. There were lots of older people with much more than $100,000 freaked out that they'd loose their life savings.
Also, right now on Yahoo! there's a headline that says "What You Can Do If Your Bank Fails." Obviously there's a serious problem that's going to take years to get out of, and the media isn't helping.
As a person looking to begin a career as a Financial Advisor it makes me wonder what would happen to a firm like Smith Barney if Citi were to go under. Would SB be sold off before that happened? Would a significant number of investors with SB panic and move their money to other firms? What would likely happen in that situation? Citi's stock isn't looking so hot, is that a sign that they could be in serious trouble?
if citigroup fails we all should just pack up and go home…the US financial system essentially have fallen completely apart… if citi fails they are such a large counterparty to the other banks that those banks would fail as well JPM Chase/ Goldman/ Morgan etc all would collapse as part of a domino effect…thus we know the goverment/fed/treasury would never let that happen…
Regardless of the realities of the US banking system - consumers are spooked. It’s a good time to not only reinforce FDIC and SIPC insurance, but also do a lot of ‘hand holding’. That said - I’d be nervous if I were a Wachovia or UBS broker.