No sooner have I digested the mind boggling spectacle of Felix Baumgartner's record-setting skydive from space, and the 24-hour news cycle is already pulling my mind in a new, equally baffling, direction.
I refer to this morning's release of Citigroup's (C) third quarter results. A set of numbers that fell comfortably within the ''better than expected" club, with adjusted earnings per share of $1.06 versus $0.96 estimates, but also made a record-attempt of their own by delivering what is arguably the financial equivalent of oatmeal.
The wonderment begins right with the Citi press release, an impressive document that is topped with no less than ten different bullet points that fill half a page. So much good stuff is apparently happening at the bank that they just can't decide which is most important and what matters most to investors. For the record, JP Morgan's (JPM) earnings announcement Friday contained 24 bullets points that went on for more than a full page!
As my co-host Jeff Macke and I discuss in the attached video, for the layman or the professional, it's hard to decide where to dig in. Is the "Ex CVA/DVA, Loss on MSSB and Tax Benefit" more important than the "Basel I Tier 1 Common Ratio" or the "Estimated Basel III"?
The short answer is no. The translated longer answer is, as Macke says, "There's a genius to it. These numbers mean NO-THING, because they can report whatever they want."
And so it goes. Five years after the financial crisis and the state of financial earnings are still in crisis. But strangely, the same cannot be said for shares of Citigroup, which are up over 30% in 3 months and at a 6-month high, but forever more impacted by the 1-for-10 reverse split it underwent in May 2011.
To be fair, Citigroup CEO Vikram Pandit does cite ''momentum'' in all three of the bank's core business, thanks in part to 3% loan growth. "That matters to me," Macke says of the more subjective insights from this $100 billion global lender. "But these numbers frankly don't."
The point is, all of these numbers may be helpful and comforting to somebody out there, but there sure aren't doing much to soothe us.
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