Fire-Sale Prices

Bank Shares Plunge

All the talk about nationalizing the banks is spooking Wall Street. Shares of Bank of American and Citigroup have dropped all week. Now, Bank of America is trading around $3—a price not seen since 1984—while Citi rests at $2, down 20 percent today alone. Both are slim fractions of their valuations from just a year ago. "People are looking at the worst-case scenario, which is either a complete nationalization or Bank of America and Citi having to raise so much common equity that they dilute shareholders. It seems to me either one is a possibility," one analyst said. "No one wants to get involved with these banks."