Goldman Sachs Group Inc. (NYSE: GS) analyst William F. Tonona put a "sell" rating -- Wall Street's equivalent of an F minus -- on Citigroup Inc. (NYSE: C)'s shares about five months too late. Is it any wonder that many money managers ignore analyst stock ratings entirely?

Like most analysts, Tonona seems to excel at telling investors what they already know such as "the lack of leadership at this point in Citi's storied history could not have come at a worse time." and "it will likely take the new CEO some time before he or she decides on the appropriate course of action to undertake.''

Citigroup has problems? Get out of town.

Tonona's call is a month after Deutche Bank AG (NYSE: DB) put a sell on Citigroup. At least these analysts are moving in the right direction. Five analysts rate the stock a strong buy, six a buy and seven a hold, according to Thomson Financial. Why aren't there more sells?

Looks like Citigroup investors are way ahead of the analysts who are paid big bucks to follow the stock.

Shareholder discontent, especially top stockholder Saudi Prince Alwaleed bin Talal, helped push out Chief Executive Chuck Prince on November 4 after the company announced an $11 billion write down because of declining value of subprime mortgages. Shares of New York-based Citigroup are down more than 40% this year.

Too bad analysts can travel back in time so their research can be relevant.

New York Stock Exchange Chief Executive John Thain has been picked by Merrill Lynch & Co. (NYSE: MER) to be its next CEO, according to media reports.

The New York Post, which broke the story, writes "The move is a huge coup for Merrill and board member Alberto Cribiore, who has led the search for a new CEO after (Stan) O'Neal resigned on Oct. 30."

But Merrill's quick move is bad news for CItigroup Inc. (NYSE: C), which had wanted to hire Thain to replace its unpopular (and now ex) CEO Chuck Prince, the Post says.

The move is unexpected, according to the Wall Street Journal [subscription required], which said "insiders on Wall Street" had speculated that BlackRock Inc. CEO Larry Fink would get the job. CNBC is reporting that Fink was offered the job but turned it down.

Thain's departure from NYSE Euronext (NYSE: NYX) isn't a shock. He viewed the job, which he got after the departure of Richard Grasso, as a public service, according to the Journal. Shares of Merrill Lynch, down more than 35% this year, rallied on the news, rising $2.82, or 5%, to $59.75. NYSE Euonext and Citigroup were little changed.

The reshuffling of Wall Street's top management is far from over. Watch this space.

Citigroup Inc. (NYSE: C), fresh off the canning of former CEO and underperformer Chuck Prince, has said that a reorganization of its investment-banking unit [subscription required] is in order. In addition, the company will be "removing" the head managers of its credit-markets group. At the same time, Citigroup will initiate a tighter integration of its equity and fixed income operations.

In other words, Citigroup is moving two executives to other roles and will be putting in place more safeguards to prevent the kind of underwriting messes and income mismanagement that helped the company to billions in write-downs in its latest quarter. Yes, the tearing down of Prince's once-mighty kingdom has begun.

This was probably in the works before Prince got the boot. There are so many things that Citigroup must now do to rectify itself and reduce exposure in some areas -- but of course, it will take time.

The Wall Street Journal reported that Vikram Pandit (from the acquired Old Lane Partners) wants to tear down the walls that were up between bankers that sell such products as high-yield bonds from those that sell stocks or derivatives. The point? Get them more focused on customer needs and not their own firm's needs. Greed and customer ignorance built Prince's kingdom; a return to putting the customer first could easily help save it.

Reuters reports that former Citigroup Inc. (NYSE: C) executives Todd Thomson -- who lost his job in January -- is talking back now that his nemesis, Chuck Prince, has been deposed.

Thomson, who headed up wealth management for Citigroup, got tossed in February. He thinks Prince smeared him -- citing his expensive office, which featured a fishbowl, and his reported flight of General Electric Co. (NYSE: GE) CNBC's Maria Bartiromo on Citigroup's corporate jet from Asia to New York. Here are two highlights:

• Maria-gate. Media reported that in November 2006 when Thomson flew with a group of Citigroup employees to China on a business trip, he flew back with Bartiromo, leaving the Citi employees to find their way home on their own. When asked about his relationship with Bartiromo, Thomson was adamant: "It's an inappropriate question. I've never been accused of having anything other than an appropriate relationship with Maria Bartiromo. And I do have an appropriate relationship with Maria Bartiromo."

Will Morgan Stanley (NYSE: MS) CEO John Mack be the next Wall Street CEO to get whacked?

The New York-based firm may have to take a $6 billion write down, in line with the $8.4 billion bath Merrill Lynch & Co. (NYSE: MER) took and trailing the Citigroup Inc.'s (NYSE: C) $11 billion pill that it might have to swallow. That estimate -- which Morgan won't comment on -- comes courtesy of David Trone, an analyst with Fox-Pitt Kelton Cochran Caronia Waller. It's double the $3 billion estimated by CNBC.

"We suggest an outright avoidance until either management discloses more specific exposure data and it proves smaller than we thought, or they actually take writedowns big enough to get beyond this,'' Trone wrote in a note to clients, according to Bloomberg News.

Shares of New York-based Morgan, which have slumped 18% since Halloween, fell $1.80 to $53.79 today as investors fretted about the size of the shoe that's about to drop.

With the downfall of Stan O'Neal and Chuck Prince, the departure of Mack would leave the one spot open in the disgraced Wall Street CEO golf foursome. My suspicion, though, is that spot is being reserved for Bear Stearns Companies Inc. (NYSE: BSC)'s Jimmy Cayne.

I can picture Sandy Weill, the former chairman of Citigroup (NYSE: C), now. He's probably pacing the floor of his penthouse apartment, wringing his hands, sweating, perhaps yelling into the phone at someone when he gets a chance. He must be all in a lather about Citigroup's drop in share price (down another 5% so far today to $35.91).

I co-wrote a book about Sandy Weill that came out in 2002 and one thing Mike Brewster and I posited is that Weill would like to run Citigroup until he met his maker. That wasn't in the cards, since he had to step down in 2003 after a series of scandals rocked the bank. And calling Weill the King of Capital, as we did in our book (King of Capital: Sandy Weill and the Making of Citigroup), didn't look so smart not too long after publication either.

Now I've been watching Maria Bartiromo on CNBC reporting that Weill does not want to run Citigroup, but will be happy to help out in the search for a new chief executive. Here's my interpretation: Of course he'd love to jump in and run the company again. He just knows the board could never give him the chance.

The New York Times has written a heartfelt love letter to Maria Bartiromo of General Electric (NYSE: GE)'s CNBC. The most interesting part to me is that Maria feels that Chuck Prince was using her "relationship" with former Citigroup (NYSE: C) executive Todd Thomson -- about which I posted earlier this year -- to divert attention from his mismanagement of the bank. With Prince out, Maria's riding high. But Todd must be kicking himself -- if he hadn't gotten into the Maria mess, he might be in a position to take over from Prince.

Since I have had the privilege of being interviewed by Maria Bartiromo -- here's a link from August -- and was called a couple of times last week to discuss the situation at Merrill Lynch (NYSE: MER), her status at CNBC is of more than academic interest to me. I have never met her in person, but her interviews have always been sharp and professional.

But the Todd Thomson incident raised questions which the article did not completely squelch. As a reminder, in January unidentified executives at Citigroup, which is both a CNBC advertiser and a frequent subject of its coverage, told several publications that among the reasons Thomson was fired was his decision to invite Maria to speak to a group of Citigroup clients in Asia and to fly her to that event in the company jet.

TheStreet.com's Jim Cramer says getting rid of the CEO was a good first step, but more must be done to turn things around.

The temptation is to say that getting rid of Chuck Prince is too little, too late for this once-great bank. But that's just not true. What needs to be done is a quick dismantling of everything that Prince has done -- his worldwide acquisition of assets, including everything in Japan, as well as the fast shedding of these hedge funds.

More important, whoever runs the place has to sell things that have simply accumulated over the years. Of course, some of this will have to resemble a fire sale -- think like what Dick Parsons, a Citi (NYSE: C) (Cramer's Take) board member, had to do at Time Warner (NYSE: TWX) (Cramer's Take) to save that.

With rumors swirling that Citigroup (NYSE:C)'s CEO Chuck Prince is about to get the axe, this may be the time to start building a position in the financial company. It's no secret that investors have been pleading to get rid of Prince, and with all the recent turmoil, I think investors will get their wish.

With Citi stock badly under-performing its competition since the departure of Sandy Weill, the only thing investors have received are tax-losses. I realize that it's never smart to get in front of a moving train, and right now Citi stock is like a locomotive heading straight downhill, but if Prince gets sent packing, and an outside person is brought in to be CEO, watch for Citi stock to change direction and start moving up.

There is plenty of value in Citi. The clear way to unlock that value would be to start spinning off divisions and let its true value be recognized.

It's gonna be a fun weekend for investors and a nervous one for Prince. Let's see if the old adage that it's better to be a king than a prince holds true.

Disclosure: Writer holds no position in any stock mentioned as of 11/2/07.

Aaron Katsman is the lead Portfolio Manager and Managing Director of America Israel Investment Associates, LLC. and Senior Editor of IsraelNewsletter.com.

TheStreet.com's Jim Cramer explains why this poor earnings report is such a crushing blow.

Yep, Merrill Lynch (NYSE: MER) (Cramer's Take) messed up, for certain. We had no idea how bad things were. They just gave us no signal. Devastating.

Citigroup (NYSE: C) (Cramer's Take)? We all knew that Prince was a pathetic risk manager. Check that, Bob Rubin and the Crown Prince don't think so, but the rest of the world does. So the fact that Citigroup needs to talk to Bob Steele at Treasury to save itself isn't all that shocking.

Wachovia (NYSE: WB) (Cramer's Take)? I thought it was more conservative than this. Then again, it bought Golden West at the top and even that great lender succumbs in this horrid environment.

But the one that really hurts, the big surprise, is Bank of America (NYSE: BAC) (Cramer's Take). To me this bank had been doing everything right, tight standards, good national growth rollout, fantastic research, good solid banking.

Suddenly, I feel that everything's on the table after that quarter. It just really blew it in lending and trading and investment banking, in mortgages, you name it.

Fortunately, of these four, Band of America could come back the fastest. Ken Lewis is no-nonsense. Anyone who disappointed will be forced out. He will review and slice and crush, as we see already. But it is the one bank that I know I had been telling people had the real growth you want out of a bank. The one that would not be a value trap. And given the fact that there were no more banks it could buy, I figured now would be when it would just return dollar after dollar to shareholders in buybacks and dividends.

I think it still will.

But after this quarter, sadly, there will be fewer dollars to give back and I just don't know how they are going to grow as fast as everyone else any more.

To me it looks like, right now, we may have lost the best bank ATM out there.


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Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. At the time of publication, Cramer was long Citigroup.

Bloomberg News reports that Merrill Lynch (NYSE: MER) added $2.9 billion to the $5 billion worth of write-offs it had already announced. And it reported a loss of $2.24 billion, or $2.82 a share, compared with net income of $3.05 billion, or $3.17, a year earlier -- this massively exceeds the 45-cent average loss estimate of 17 analysts surveyed by Bloomberg. Now questions are being raised about whether its CEO Stanley O'Neal will get the boot from Merrill's board.

What would be the case for booting O'Neal? He pushed Merrill into the risky area of subprime mortgages to get higher returns. While some of his lieutenants have paid the price for their supervision of this risk, Merrill's $7.9 billion cost -- which exceeds Citigroup Inc.'s (NYSE: C) $6.5 billion -- is 58% more than Merrill had projected a mere two weeks ago. And it calls into question O'Neal's judgment since he clearly did not anticipate the severity of the decline in the credit markets since July, after late mortgage payments from borrowers with poor credit histories surged.

And Merrill's problems don't end with subprime. The credit markets also forced Merrill to write down the value of leveraged buyout loans that the firm had to make after investors refused to finance them. Those devaluations totaled $463 million, after underwriting fees.

TheStreet.com's Jim Cramer says there's a shocking disparity in risk management between the pros and the bush leaguers -- and which proved to be which here.

If you want to see a contrast that will blow your mind, go read the transcripts of the Citigroup (NYSE: C) (Cramer's Take) and State Street (NYSE: STT) (Cramer's Take) calls. They are night and day.

Last month we had a raid on State Street, a vicious raid that implied that its conduits, its structured vehicles (basically partnerships it set up for clients) could blow up in the company's face causing billions in losses.

Citigroup has roughly the same kind of partnerships. They were set up to securitize mortgages and sell them to money funds and the like. Given that both have considerable exposure to these kinds of conduits the thought was that both could be crushed by them, but that State Street, given its smaller base of business, could be annihilated.

Having followed State Street for years, and covered some of the accounts there, I was blown away at the insinuations. This is a great bank with phenomenal risk controls. When I called up there to check with my sources I got a clean bill of health and said so on TV, making a point that this was not any old stupid bank but a well-run one that was just being targeted by the shorts for a quick profit.

Citigroup, Inc. (NYSE: C) saw a 57% drop in its Q3 profit as reported yesterday, which unfortunately should not come as any surprise to long-term watchers of the financial services company. I continue to be amazed that current CEO Chuck Prince, who took over from the legendary Sandy Weil four years ago, has lasted this long with the up-and-down performance levels he led the company to in his tenure.

Peter wrote on this a few weeks back, and it's something I completely agree with. As a shareholder in this company, I'm calling for change. Wait, I did that already (years ago). Perhaps my luck will change after this summer's credit crunch sacked Citi in the gut.

Let's pour some more salt in the wound: after yesterday's quarterly meltdown, the financial services behemoth acknowledged that the risk management models it has in place to prevent the kind of nuttiness bestowed upon it by the subprime lending situation that's still underway failed the company.

Citigroup (NYSE: C) reorganized its management, probably in reaction to the huge write offs it took in the last quarter. Almost everyone got a new job, other than CEO Chuck Prince.

Citi is pushing out its head of trading and one of its fixed income chiefs even though as Reuters points out "Citi's warning last week left some investors calling for Prince's ouster." As one analyst told the news agency: "Clearing the bench may be therapeutic, but it doesn't necessarily improve Citi's ability to fix the mistakes that were made or seize opportunities in these markets."

All of the demands that Prince leave neglect to consider that Citi's shares have done no worse than those of other big banks. While its shares are off about 3% over the last year, so are the stocks of Bank of America (NYSE: BAC) and JP Morgan (NYSE: JPM).

Prince may be a poor manager, but he is also a victim of his times. If he goes, so should the heads of other large banks, or the market can wait to see if Prince can fix things.

Douglas A. McIntyre is a partner at 24/7 Wall St.

TheStreet.com's Jim Cramer can't understand why the bank's board of directors hasn't fired this CEO already, much less after news of horrible results.

Why not fire Citigroup (NYSE: C) (Cramer's Take) CEO Chuck Prince? I mean, what the heck is the big deal about it? Why is this board of directors so wedded to this guy? What are they waiting for?

I am astounded that, after this miserable preannouncement of $3 billion in charges for the quarter, Chuck Prince doesn't simply announce that he is stepping up to executive chairman to promote new people. How can this guy have such a hammerlock on this company?

The company's statement today is remarkably horrible, replete with all sorts of language by Prince that says the company really blew it. What's the issue now with not firing him? What makes him one of the protected CEOs? How can he get away with it?

I am seething about this. Here was the worst quarter of any of the financials so far, and he's unscathed? Where is the justice? Where is the outrage?!?

I guess it just doesn't matter. He's there as long as he wants to be.

Which means, alas, forever.

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Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. At the time of publication, Cramer was long Citigroup.