Wednesday, February 16, 2005

Continuing Cracks

"Citigroup recently admitted to a 6.3% stake in Fannie Mae. Given that Fannie Mae has a $60 billion market cap, Citigroup's stake is worth $3.78 billion. Since December 31, 2004, Fannie's stock has declined by 11.2%, handing Citigroup an unrealized mark-to-market loss of $423 million year-to-date."

For every cent Fannie's stock price goes down, Citigroup loses nearly $600,000 dollars," says Rude Awakening editor, and former Citigroup employee, Tom Dyson, while gleefully punching numbers into a calculator. "Today it's down $1.09. Thing is, every portfolio in corporate America owns Fannie stock...pension funds, mutual funds, insurance companies, financial conglomerates...and they're all getting hit. Incidentally, Citigroup is not the largest holder...Capital Research and Management Company owns nearly 10% of Fannie, and Fidelity Management & Research Corp own over 8%. I don't know what these entities are, or who controls them, but if Fannie stock keeps falling, I suspect we may find out!"

2 comments:

Trumbule said...

shouldn't it be 366 "million" ?

Gerald Trumbule said...

Yes, the correction came through the next day (see above), and thanks for actually reading the blog. It's good to know that at least one person is paying attention.