Citigroup Plans to Cut 20k Jobs • Hacker News Board

Re: Citigroup Plans to Cut 20k Jobs

#141

Post by UberFly » Fri, Jan 12, 2024, 5:39 PM UTC

nradov wrote: post #103

pixl97 wrote: post #69

Earlier quoted context omitted.

Unemployment is historically low, but costs are historically high. In 2008 we saw that the state change from good to bad can happen rapidly and contagiously between industries. > They can also downsize and/or move to an area with lower cost of living. No, not really. There are simply no housing units available in the US to do that. All new housing is huge 2000sq/ft +. In addition housing prices are just off the chart…

Come on, stop making up nonsense. Just to pick one example there are numerous single family homes near Cleveland on the market for under $100K.

Can't tell if you're trying to be sarcastic.

Re: Citigroup Plans to Cut 20k Jobs

#142

Post by wolverine876 » Fri, Jan 12, 2024, 5:40 PM UTC

raziel2701 wrote: post #81

What's going on with all these job cuts all concentrated now? The market is expecting the Fed to start cutting interest rates[0] in March and that has been bullish for the latter half of last year in the stock market. So why are so many companies cutting people? Are the March rate cuts too little too late or do they see that some damage has already been done and they're front running that? Or is it that layoffs is th…

I don't recall something like it ever happening, except perhaps when there was an economic event (like in 2008). It's either a big coincidence, or there is a common outside cause, or it's coordinated.

Re: Citigroup Plans to Cut 20k Jobs

#143

Post by anthomtb » Fri, Jan 12, 2024, 5:40 PM UTC

bushbaba wrote: post #72

punkbit wrote: post #29

Housing is extremely expensive. I wonder how people pay rent, mortgage, and other expenses with so many layoffs.

Take a mortgage. You get severance. Then if you fail to make payments it’ll take 3-6 months before foreclosure starts. Most can get a job within that time frame.

> you fail to make payments

In the US this will wreck your credit rating. Yes, you'll survive and won't lose your house. But your borrowing costs will increase significantly if you need a new home, renovation, car, etc.

Re: Citigroup Plans to Cut 20k Jobs

#144

Post by nostrademons » Fri, Jan 12, 2024, 5:41 PM UTC

raziel2701 wrote: post #81

What's going on with all these job cuts all concentrated now? The market is expecting the Fed to start cutting interest rates[0] in March and that has been bullish for the latter half of last year in the stock market. So why are so many companies cutting people? Are the March rate cuts too little too late or do they see that some damage has already been done and they're front running that? Or is it that layoffs is th…

It's January. This is when annual budgets are set. Layoffs are a natural consequence of "the budget for this year is smaller than last year". Hell, even if the budget is the same size, it'll result in layoffs if anyone got promoted, anyone got cost-of-living raises, etc. A 4% cost-of-living adjustment for everyone results in a ~4% layoff if annual budgets remain constant.

Also, the market is predicting rate cuts in March. There is always the chance of the market being wrong, and several prominent institutions (notably Goldman Sachs and JP Morgan Chase) have said they believe this is overly optimistic and it's unclear if we're even done with rate hikes, let alone rate cuts. The Fed statements themselves do not come anywhere close to what the market is predicting - the dot plot (which has trended overoptimistic for the last 3 years) predicts 3 rate cuts, while the market predicts 7.

Re: Citigroup Plans to Cut 20k Jobs

#145

Post by JackFr » Fri, Jan 12, 2024, 5:43 PM UTC

bushbaba wrote: post #66

thiago_fm wrote: post #21

They do an outstanding job in mismanaging money. Surprised they are only cutting that much. They are on their way to become a new credit suisse, hopefully this helps to change that course. If you are interested in this subject, compare it to other big banks like JPMorgan Chase, Bank of America etc. The difference is abysmal.

I never got why people choose citi. They don’t offer best lending rates, they don’t have a vast ATM network, their credit card benefits are worse than chase/amex, etc. seems they aren’t really amazing at any particular segment but meh in all.

Their competitors are BofA and JPMC.

All three feature an investment bank, a commercial bank and an asset manager. There are a number of smaller operations which have all three but none at the scale of those three. Wells is much smaller, and HSBC isn’t a US bank. Goldman and Morgan Stanley don’t really have a commercial banks and neither do the mega sized asset managers like Blackrock.

So the thing is Citi isn’t really a bad commercial bank and is really useful for corporate treasury services if you’re a large multinational company. Their international footprint is huge and fit a lot of use cases it’s either them or HSBC.

The problem is the IB and AM are ‘meh’ and hugely inefficient. It’s not like they do such a terrible job from a customer perspective. From an investor perspective it just costs so much to do it.

Re: Citigroup Plans to Cut 20k Jobs

#146

Post by anthomtb » Fri, Jan 12, 2024, 5:44 PM UTC

antongribok wrote: post #38

punkbit wrote: post #29

Housing is extremely expensive. I wonder how people pay rent, mortgage, and other expenses with so many layoffs.

Aren't we already seeing rent prices going down?

I have a rental which has been on the market since late September. The price has gone down by 20% (but was probably way too high to begin with).

I will not drop the price further due to some weird laws in my American state. Ideally though, it would go down another 10%.

Re: Citigroup Plans to Cut 20k Jobs

#147

Post by wolverine876 » Fri, Jan 12, 2024, 5:45 PM UTC

The primary concern is the people who have lost jobs, and for some, careers and dreams. Some of them are probably reading HN today.

But for the economy, it could be a good thing: Talent moving from moribund, unambitious, lower-return businesses to dynamic, often new ones that are hiring and expanding for an optimistic future. (I say unambitous because they are, at least in this situation, cutting costs and talent rather than investing in and taking risks for a bold future.)

Unemployment is low, the economy is growing. Usually layoffs, etc. happen widely when the economy is slow and unemployment high, and then the newly unemployed have a hard time finding new jobs.

If it's going to happen, in some senses now may be the perfect time for the individuals and the economy.

Re: Citigroup Plans to Cut 20k Jobs

#148

Post by nradov » Fri, Jan 12, 2024, 5:47 PM UTC

pixl97 wrote: post #121

nradov wrote: post #103

Earlier quoted context omitted.

Come on, stop making up nonsense. Just to pick one example there are numerous single family homes near Cleveland on the market for under $100K.

I don't think 390 results is going to solve the US housing crisis. In addition if pressure demands that lower priced houses are in demand those costs will go up. Lastly, hopefully you can remote work, or surviving on that $28 and hour in OH is going to be fun.

As I wrote, Cleveland is just one example. There are literally thousands of other cities around the country where housing is affordable and home ownership rates are very high. Broaden your horizons.

Re: Citigroup Plans to Cut 20k Jobs

#149

Post by Cruncharoo » Fri, Jan 12, 2024, 5:47 PM UTC

Whatarethese wrote: post #87

I assume Citigroup is planning for the output of their workforce to decrease with all these layoff and not assume the other employees to pick up the slack. Right?

In a number of cases, yes. Whole departments are being slashed/they are exiting certain business lines so no need to pick up the slack there.

Re: Citigroup Plans to Cut 20k Jobs

#150

Post by raydev » Fri, Jan 12, 2024, 5:47 PM UTC

asciimov wrote: post #137

raziel2701 wrote: post #81

What's going on with all these job cuts all concentrated now? The market is expecting the Fed to start cutting interest rates[0] in March and that has been bullish for the latter half of last year in the stock market. So why are so many companies cutting people? Are the March rate cuts too little too late or do they see that some damage has already been done and they're front running that? Or is it that layoffs is th…

New year and quarter for businesses, gotta show you made more money by spending less on salaries. They can fire now and still be covered by "the market made us do it". Fire now, and rehire for less in the next quarter or two. The US needs better protection for workers. If a corp has to fire 20k, that is a leadership problem and they should go too.

At this point, we are in full bandwagon/meme territory, aside from the few companies that actually do need to fix their cashflow.

Now that the stock market will probably immediately reward you if you just recite the mantra "we overhired, COVID, etc", it's just the latest way to juice your stock price. There's enough padding when you have thousands of employees that your products won't suffer too much, and it gives you an excuse to reorg and perhaps find more efficiencies in the process. In theory, I can see the draw of "a reset will make us faster".

Of course, new efficiencies aren't guaranteed and the company's output may stay the same or shrink in the future, but at least the shareholders got more money.

Layoffs in December can potentially be bad press, so what we're seeing now is the execution of the 2023 plan to Big Reset before the market judges this type of move as a bad look again. Everyone else is juicing their stock prices this way, why shouldn't we?