The global economy, dependent for too long on U.S. consumer spending and financial wizardry for growth, needs "a new business model," according to Citigroup (C) CEO Vikram Pandit.

Pandit's diagnosis of the U.S. economy is hardly controversial: "We have too much leverage as consumers and as a financial system," he said at the Detroit Economic Club's National Summit. "This leverage funded consumption and created the illusion of financial returns."
There seems to be an easily drawn parallel between the problems in the U.S. economy and those facing Pandit's own company. "We too were very credit-dependent and relied too greatly on non-core, or wholesale funding sources, including securitization and other aspects of the shadow banking system," he said in prepared remarks, according to Bloomberg News.

Citi investors and those who've watched the company recently probably won't be surprised by Pandit's comments.

Since coming aboard as CEO in December 2007, he's been working feverishly to shrink Citi, once the world's largest bank, and faces the daunting task of repairing the damage wrought by more than $27 billion in losses suffered last year.

Meanwhile, the company has taken $45 billion in aid from the federal government, while its share price has fallen 90 percent.

What may grab some attention is Pandit's forecast for the U.S. economy. "We don't save enough as a country," he said. But repairing that deficiency will likely slow growth during an "adjustment period," he added.

"We all know there's a clear trade off between stimulating the economy on a short-term basis and saving more," Pandit said.

To spur growth, the United States needs to invest in faster-growing foreign markets that aren't weighed down by the debt the U.S. has incurred to fund its efforts to jumpstart the economy, according to Pandit. (He did acknowledge that some of that money has gone to Citi in an off-handed way, referring to all the "help" the company has received.)

"We will need to tap international growth to drive our own growth," he said. "We need foreign markets, we need foreign consumers and we need export more."

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