POWIP Piece of Work In Progress

CIT Tango Uniform; officially files bankruptcy.

As speculated most of the weekend, CIT group officially filed chapter 11 bankruptcy in the southern district of New York, causing concern among many who rely upon them for short term operational credit; none of it's operating sibsidiaries, such as CIT bank, will be included in the filing.  An overwhelming percentage of the company's creditors approved of a pre-packaged plan to restructure, a move that will allow proceddings to move ahead quickly.

It is uncertain how this will effect both the overall market and the customer base, specifically many retail suppliers, that would ordinarily rely on their credit lines to get through the upcoming holiday season.  And of much greater concern in Europe is CIT's involvement in a majority of the CDO's held, and what the effects the bankruptcy will have.  In fact, the only thing that we do know with any certainty right now is that the taxpayers will ultimately lose the 2.3 billion that was advanced to CIT, for which the US government held preferred stock as collateral, since all shares of common and preferred will ultimately be cancelled.

Right now, the market seems to be up, regardless of the filing yesterday, so as to what will ultimately happen, your guess is as good as mine.

Rocketman