Bank Of America Is Just The Start Of Paulson's Problems: Behold.... Citigroup

With Bank of America getting taken to the woodshed, we can only hope that Paulson managed to sell all of his stock in the name, or otherwise just like Bruce Berkowitz is organizing a call to defend Bank of America on Wednesday, Bank of America would have to organize a call today to protect JP from his LPs. Alas, Bank of America is just the start of Paulson's problems. For a just as big problem we shift our attention to the next worst bank in America, Citigroup, which as the excerpt below demonstrates, was a bragging point in the firm's January 2011 letter. Alas, there is little to brag about these days. Which is why we wish to caution investors to be vary careful with liquidation-like selloffs in gold. Should D-Day strike at Paulson, the firm's multi-billion GLD "gold share class" will likely have to be sold very fast to preserve liquidity. When that happens we may see a 20-30% correction in gold in one day. This is just a theoretical warning, and we hope to have some sense of when, if at all, it would take place. But just something to keep in the backs of your heads...

From Paulson January 2011:

Uh, ok...

Here is why Paulson is now likely down 30% for the year and the margin calls may soon commence.