Government Doesn't Think/Act Like an Owner

Yet another case study. This front page article from Saturday's WSJ recounts how the federal government, ostensibly a large owner of Citigroup, essentially forced it to give away a valuable asset for a song. Why? Political priorities of course. Given this kind of boneheaded situation, no sensible private owner is going to want to co-invest with the government, which is why government capital is the kiss of death. Citigroup has preciously little, if any, access to the private capital markets going forward, a significant structural disadvantage, given its relationship with the government and the Phibro case is a classic study of why that is.