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If you aren't scared, you aren't paying attention:

Citigroup announced a steep cut in its stock dividend and another big investment by foreign investors on Tuesday after taking more write-downs related to subprime securities and posting a $9.83 billion loss for the fourth quarter.

Beginning what is expected to be a grim week for financial company earnings, Citigroup said it was writing down $22.2 billion because of soured mortgage-related investments and bad loans. The bank is also cutting its dividend by 41 percent and obtaining a $12.5 billion cash infusion to strengthen its balance sheet, including big investments by its former chairman, Sanford I. Weill, and the Government of Singapore Investment Corporation.

Facing rising expenses and deepening losses, Citigroup is expected to embark on a major cost-cutting campaign that could result in at least 4,000 layoffs. And thousands more could be in the offing in the coming months.

The write-downs caused Citigroup to swing to a loss for the fourth quarter. The fourth-quarter loss translated into $1.99 a share, compared with a profit of $5.1 billion, or $1.03 a share, in the period a year earlier. Revenue fell 70 percent, to $7.22 billion from $23.83 billion.

The write-downs included $18.1 billion from a sharp drop in the value of mortgage-related securities and heavy trading losses. The company also set aside an additional $4.1 billion to cover expected losses from bad loans....

Once one of the world’s mightiest banks, Citigroup’s capital levels have been severely depleted in the fallout from the continuing credit crisis and worsening downturn in the housing market. Even with the $12.5 billion capital injection, analysts think that the bank may need even more money to shore up its balance sheet if economic conditions worsen.

“In an uncertain environment, these actions put us on our ‘front foot,’ focused on capturing opportunities that earn attractive returns for our shareholders,” Vikram S. Pandit, Citigroup’s new chief executive, said in a statement. He said the bank’s fourth-quarter results were “clearly unacceptable.”

Citigroup lined the $12.5 billion of capital through the sale of convertible preferred securities from several big investors, including two funds sponsored by cash-rich foreign governments. That comes on top of a $7.5 billion stake that the company sold to a Middle Eastern government fund, the Abu Dhabi Investment Authority, in November.

The Government of Singapore Investment Corporation will make a $6.88 billion investment, giving it one of the biggest ownership stakes in the company. The Kuwait Investment Authority, Capital Research and Management, Citigroup’s biggest shareholder, and the New Jersey Division of Investment also made large investments.

Notice that to get ourselves out of this mess we are having to sell off our parts of our biggest banks to foreign government. Not foreign corporations. Foreign governments.

And its not just Citi. More from today's news:

NEW YORK (AP) -- Merrill Lynch & Co. said Tuesday that it is getting a cash infusion of $6.6 billion from three foreign investment funds.

The Korean Investment Corp., Kuwait Investment Authority and Mizuho Corporate Bank will receive a special class of stock for their combined $6.6 billion investment. All will be passive investors and none will have any rights of control.

Both the Korean and Kuwaiti investment groups are owned by the state governments. Mizuho is a Japanese investment bank.

This is, I'm afraid, the beginning of a very long and very dark period in our nation's economic history. I'm already convinced this will be the worst recession of my lifetime. The question, I guess, is worse by how much. Ugh.