Exploring Citigroup's Restructuring, WeWork's Bankruptcy, and a Potential Global Crisis | Weekly Business Briefs with Martin Perdomo

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Get your front row ticket to the shifting landscape of the business world this week! We're going under the hood of Citigroup's restructuring plan that could result in a massive 10% job cut. Wondering how that might impact you? Stay tuned. We're also pulling back the curtain on WeWork's bankruptcy filing, which is shaking up the office space industry. But that's not all. We're delving into Jamie Diamond's alarming warning about a potential global crisis, and trust us, you won't want to miss this conversation.

As we steer the conversation into the second half, we're putting the spotlight on the brewing tensions in the Middle East and its potential to plunge the world into a crisis we haven't seen since World War II. We're rolling up our sleeves and getting deep into what this could mean for you and the global economy. So whether you're a seasoned investor or just curious about the state of the world economy, join us for this eye-opening exploration. We promise an episode filled with thought-provoking discussions, critical insights, and a comprehensive look at the current state of financial markets.

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Episode Transcript

Speaker 1 (00:00):
Citigroup considering at least a 10% in job cut in
major businesses, wework oncevalued at $47 billion files for
bankruptcy and Jamie Dimon warnsconflict in the Middle East
could trigger the most seriousglobal crisis since World War II
.
These are the top threeheadlines and this week's weekly

(00:23):
business brief.
First up Citigroup managers andconsultants working on CEO Jane
Frazier's reorganization havediscussed job cuts of at least
10% in several major businesses.
According to Reuters on Monday,the bank has warned of job cuts
as part of the sweepingoverhaul it unveiled in
September, but has said it willestimate the scale of layoffs

(00:46):
and cost savings in the currentquarter.
The reorganization, knowninternally as Project Bora Bora,
according to CNBC, is intendedto give Frazier more direct
control as she seeks to simplifythe Wall Street giant and boost
its stock price.
The discussions are at theearly stage and the number of
people asked could change, cnbcsaid, adding that the lender had

(01:10):
hired Boston Consulting Groupfor the plan.
Frazier's push to eliminateregional manager, co-heads and
others with overlapping rolewould translate into job cuts
beyond 10% for executives, thereport said last month.
Citigroup said it would cutmanagement layers from 13 to 8.
In the top layers of leadership, 15% of functional roles were

(01:34):
reduced and 60 committees wereeliminated, it said.
The bank's global headcount hasstayed at 240,000 this year.
It disclosed in its latestquarterly supplement last month.
Now, if you don't think this isthe banking crisis pushed by the
feds, then I don't know whatworld you're living in.
We've had rates gone throughthe roof.

(01:55):
The lenders are scared to lend,they're technically frozen on
lending, real estate has stopped.
Credit card default is startingto creep up.
So this makes sense that thisis happening here in the banking
sector, and this is one of thebig one, guys.
So last week, jamie Diamondsaid he was going to sell about
a million shares.
This week, we're seeing thatCitibank is wanting to now cut

(02:23):
10% of their workforce.
Guys, that's a big number.
So I'm starting to see apattern here.
Sbb earlier this year went outof business and a couple of
other banks.
There's a pattern here withinthe banking sector.
Let's see where this is goingto play out, and it's not
looking good right now for themoney supply people, the people

(02:44):
that supply the economy withmoney, which are the bankers.
Next up Office Sharing Companywe work files for Chapter 11
bankruptcy protection in NewJersey federal court on Monday,
reported by CNBC.
We work said that it hadentered into agreements with the
vast majority of its securednote holders and it had intended
to trim non-operational leases.

(03:05):
The Bank of the Sea filing islimited to WeWork's location in
the US and Canada, the companysaid in its press release.
We work reported liabilitiesranging from 10 billion to 50
billion, according to an initialfiling.
I am deeply grateful for thesupport of our financial
stakeholders as we work togetherto strengthen our capital

(03:27):
structure and expedite thisprocess through the
restructuring support agreement.
We work CEO David Talley saidin a press release we remain
committed to investing in ourproducts, services and
world-class teams of employeesto support our community.
Wework has suffered one of themost spectacular corporate

(03:47):
collapse in recent US historyover the past few years, valued
in 2019 at $47 billion in around led by Myosie Sun Softbank
, the company tried and failedto go public five years ago.
The COVID pandemic causedfurther pain as many companies

(04:08):
abruptly ended their leases andeconomic slump that followed
even more clients to close theirdoors.
So this is an interestingconcept if you are not familiar
with WeWork.
Wework is a company that buysor leases these big office
buildings and then theysub-lease or lease share

(04:30):
workspace.
But when the pandemic hit andpeople started working from home
, there was a big dip in a çünkübeiden in demand for these
spaces, so they're hurting.
I personally can attest forthat.
I personally have an officespace that I stop lease to to
other companies, and in recentand past years, prior to COVID,

(04:53):
I couldn't keep those thingsopen.
I would put them on Craigslistor Facebook and within a week
I'd have it leased up.
It's all inclusive for $350,private office, private
everything.
And now it takes us months torent one of those little office
suites, and so I personally canattest to the pain, and so I can

(05:17):
imagine for them at a big scale, having these big spaces and
these big buildings, how thiscan happen to them.
Lastly, conflicts in Europe andthe Middle East risk triggering
the most serious global crisissince the Second World War.
Jamie Diamond has warned.
According to the insider, theJP Morgan Chase Chairman and CEO

(05:39):
said in an interview with UKSunday Times that Russia's
invasions of Ukraine andIsrael's war with Hamas has made
the world more scary andunpredictable.
Here in the US, we continue tohave strong economy, he told the
outlet, likely referring to thecountry's surging GDP growth
and resilient job market.
We still have a lot of fiscaland monetary stimulus in the

(06:03):
system, but these geopoliticalmatters are very serious,
arguably the most serious since1938, diamond added, referring
to the year Nazi Germany annexedparts of Tieskala Vaskia and
stepped up its persecution ofthe Jewish people.
Financial markets have largelyshrugged off the conflict in the

(06:26):
Middle East.
One month after Hamas' strikeon Israel.
The S&P gauge of US stock hasclimbed 1% since October 7th,
with investors feared by theidea that Federal Reserve
probably won't raise interestrates Again.
The MCI World Index, whichtracks global equity, msci

(06:47):
excuse me, msci Global WorldIndex, which tracks global
equities, is also up in around1% over the same period.
Meanwhile, brent and West Texasintermediate oil prices briefly
flair up after the Hamas'attack on the fear that major
producers Iran major producerIran could become embroiled in a

(07:10):
broader conflict, but the twobenchmarks have since slid back
to pre-war levels.
Diamond, who heads the USlargest bank, said it would be
futile to worry about marketswhen the world is on the brink
of such a grave crisis.
Agreed, sometimes we think herein the US and if you're

(07:31):
listening to me and you'reoutside of the country but here
in the US we tend to not thinkabout these things, and
sometimes these things are outof sight, out of mind.
It's not in our backyard.
These things affect us and theywill affect us.
When the world's largest bankeris saying that this, it could
have a grave danger, we shouldbe taking massive precautions

(07:53):
and we should be payingattention to this.
I believe that we need to bewatching this and paying
attention to this.
So what do you think about thepotential for the Middle East
conflict to cost the mostserious global crisis since
World War II?
That's serious.
I'd like to get your thoughtson that.
Share your thoughts down in thecomments below and let's
discuss.

(08:14):
And this has been your weeklybusiness brief.
I'll see you guys next week andremember to like and subscribe
to the channel to keep up withthe latest business update.
Peace out.