Faith in the system in question?

I have been taught that when you do the right thing, good things will happen to you. Tonight Citigroup announced they have raised $17 billion through the sale of 5.4 billion common shares at $3.15. Bloomberg Link.

The global credit crisis of 2008 brought the financial industry to its knees. One resultant is that of Citigroup being assisted by federal government diluting the common share value dramatically. This was required because certain individuals of the company took the wrong side of a bet and lost big. Dramatically no one is held responsible for the company's mistakes and in turn the tax payers were shouldered for the mistakes. Any government money in the end really comes down to tax payer money.

Excluding all the money I lost investing in Citigroup over the years I am avoiding any trades with this company. Already depressed with my loss this news of hearing Citigroup diluting it's shareholders even more makes me... no words can express my anger. How on earth can they get away with this?

Oh, the government is helping them. The government's intervention in 2008 to save Citigroup priced in at $45 billion in preferred shares and assistance paying a portion of the company's $301 billion losses in investments. Reference Link. In 2009 the government owned, no tax payer owned, preferred shares were transitioned to common shares at $3.25 a piece.

Just in the recent days Bank of America accumulated $20 billion in a stock sale diluting their shareholders in order to pay back their share of the TARP money- government assistance. Citigroup and Wells Fargo not wanting to be left out decided to dilute their own shareholders too and tonight Citigroup has paid back the TARP money they owed. In doing so Citigroup as a company will avoid $38 billion in taxes to the federal government and forced shareholders, mainly tax payers, to pay back the TARP money through a common shareholder dilution.

The $3.15 per share dilution is below the investment the government paid for owning about 1/3 of the common shares before dilution. In essence tax payers got shafted in every which way possible. Reference Link.

There is no way to hide from the loses. Even if I do not invest in the market the government will just take my money and your money and waste it for the benefit of wall street. To put icing on the cake Citigroup having paid back their share of the TARP money will now be allowed to pay their employees beyond the restricted $500,000 for the year 2009. Reference Link. The employees that created the global credit crisis.

This in inhumane and it will continue indefinitely as long as the American population allows it. I want to know if someone does wrong, should they not be punished for it? I can only hope this question will be answered sooner rather than later.

The past does hurt...

I should have learned how day trading works and how trading equities operate before I made my purchase of "C". Now for my continuation after my first buy/sell equity.

On the same day I sold "C" I immediately used the proceeds to purchase Sallie Mae "SLM" at $17.847/share for 1000 shares. In two hours I sold the shares at $19.17/share for a total profit off +1323 excluding commissions and fees.

Thinking I just made my first gains with such ease and swiftness I decided to trade other stocks on the same day. Little did I know I had violated many of the fundamental rules of the stock exchange.

Mistake 1) I purchased "C" with cash and when I sold it, I did not know that my proceeds would not be in my account balance until after three business days with starting date being when I sold the equity. My mistake was that I initiated another trade on the same day with the same proceeds. You can not do that and I was notified with a violation letter.

Mistake 2) I further incurred two more violations because for the next three trading sessions I was trading in and out of equities with the same amount of cash. My account was then listed with a restriction for 90 days from trading.

My heart just sank. After three sessions of trade I never was notified, online, that I was breaking any rules or regulations. I only found out when I opened the first violation letter three days after I made the violations. A glimmer of hope poke through when I learned about Margins after speaking to one of my brokerage representatives.

This is to much to bear because it was just too painful to recount about all the dumb mistakes I made financially. Yet by blogging I can remind myself and others what NOT to do in stock trading. I will elaborate on Margins in next post.