Through The Fly's Eyes: Citigroup

from Theflyonthewall.com








Eddie Lambert Builds Stake in Citigroup

Citigroup (C) has attracted the attention of Eddie Lambert, hedge-fund manager extraordinaire. Why? Two reasons.

First, Citi is a good way to play a steepening yield curve. With the economy, for the most part, showing signs of slowing down, Fed interest rate drops should lead to high profits for the financial services giant.

Second, displeasure with Citi's CEO, Chuck Prince, could lead to management changes or a break-up of the company. Tom Brown of Second Curve Capital and Bankstocks.com has been suggesting the break up of Citi for some time.

Sometimes in the investment business it is best not to think but to follow. Lambert has been on a great roll so why not go along for the ride. Citi generates a good dividend, prints money and portfolio managers will have to shift more of their assets into financial service stocks as the fed drops rates and the yield curve steepens.