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Stock Pain

U.S. financial markets opened today to the news that Citigroup lost a bunch of money in Q4'07. A few highlights:

  • Loss of $9.8 billion ($1.99/share)
  • $18.1 billion portfolio write-down
  • $4 billion reserve against consumer credit defaults
  • $12.5 billion raised from equity (dilutive to existing shareholders)
  • Dividend cut by 41%
  • 4,200 job cuts
  • Stock down 7.3% during the session, and another 1.2% after hours

Intel also published earnings for Q4'07 today. Giant pile of money:

  • Profit of $2.3 billion ($0.38/share)
  • Record quarterly revenue of $10.7 billion
  • Gross margin 58.1%

So what does our stock do? … it fell 1.7% during the session, and after our earnings announcement it fell 14% after hours.

Awesome. My stock options have lost 96% of their value in the past two weeks.

Interesting how Citigroup's nigh-apocalyptic earnings report is met with a big decline, yet Intel's hugely profitable earnings report nets a decline twice as large. Investors are fickle. :)


I'm enormously happy about the horrible year the stock market has been having so far (e.g. Dow down ~6% YTD) because I fund all my tax-advantaged accounts during the first quarter. I'll be buying more cheaply.

But now I wish I hadn't also invested a bunch in mid-December! At least I invested safely… only one very small position of what I bought (~$500) has underperformed the Dow since then.

For comparison, gold is up ~6.5% YTD, and silver is up ~8%.


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Tiny Island