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 When it comes to the bonds of struggling lender CIT Group Inc. (NYSE:CIT), the message from CreditSights Inc. is to flee before it's too late.In a report released Tuesday, the credit research firm warned that even a bailout from the government wouldn't be enough to keep the floundering firm afloat, according to Bloomberg. "Even if CIT receives another round of support, we believe bondholders are not out of the woods," David Hendler, an analyst at CreditSights in New York, wrote. "We believe CIT's funding model is broken and have our doubts over whether an additional capital injection would cure the problem." CIT has about $1 billion in bonds due next month and $10 billion by the end of next year. But it is unable to issue new paper without a government guarantee because of worries about its creditworthiness. The lender said on Monday it was in talks with the Federal Deposit Insurance Corp. about several measures to improve liquidity, including obtaining a guarantee under the Temporary Liquidity Guarantee Program, and on Wednesday media reports say that a deal could happen as early as Thursday. (The Deal Pipeline subscribers can see full coverage of CIT here.) The lender has already received $2.3 billion in TARP money, but it is expected to get plenty more as the Obama administration seeks to head off a meltdown in the middle-market financing arena. CIT's internal documents say that its demise would put 760 manufacturers at risk and bring about a crisis for as many as 300,000 retailers. But as with most rescues of troubled companies, the capital is likely to come at a price. With CIT's situation not looking like an easy turnaround, it could end up being part of Uncle Sam's portfolio for a long time to come. - George White
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