RE: The Day AfterA few comments...
First, while reading that blog might provide some food for thought, keep in mind that that guy is (or has been) long BCE, and you can tell he is biased toward teh deal going through. He presents opinions as facts, like most "journalists" (as if). So do not lend any more weight to his opinion than you would anyone else's. Probably less.
Second, while I still do believe the deal will close as scheduled, one would be foolish to say that the odds haven't decreased over the past few days. Citi's situation (perceived or otherwise) has rapidly and substantially deteriorated. Wow - what a difference just a few days makes, eh? There are a number of possibilities. Most - but not all - of the possibilities lead to a deal closing. So it really depends on what the Treasury/NY Fed and the fools that run Citi wind up doing. I certainly would not buy the common shares in Citi - as tempting a day/swingtrade as it appears to be. We do not know what the truth is re: Citi. We cannot trust their mgmt or BOD. Analysts are mixed - some see the worst, some say things aren't so bad and that it's panic selling and/or a bear raid. One thing for certain - Citi will not be allowed to fail. My guess is that an injection of capital for more preferreds&warrants and/or commons is the most likely scenario. I can't see anyone buying them. A merger won't happen unless the Fed forces it on Citi and probably GS, which would also require another large capital injection. If Citi really does not need the capital, then the govt needs to state that loud and clear in order to restore confidence in it's SP.
Third, mark to market is the biggest problem facing the banks. It puts an unreasonable burden on them. It overstates profits in good times and overstates losses in bad times. They should be allowed to smooth out the gains and the losses over longer periods of time. Get rid of M2M and you will also get rid of the rampant shorting.