Bullshit Assets

Jonathan Weil from Bloomberg has a nice explanantion of how Citigroup had negative equity of $8 billion as of last Friday's market close. Enter another accounting star: DTA's or Deferred Tax Assets. Companies can claim losses as assets according to how much they are entitled to in tax savings on future earnings. Wall Street, of course, loves turning losses into gains. Let's see if the government bailout accomplished anything. They gave Citigroup $29.5 billion in new equity by buying preferred shares, and they guaranteed up to $250 billion in losses on Citi's SIV assets. Citigroup's market cap is now $32 billion.