By Steve Garcia

Citigroup (NYSE:C) announced yesterday that it is selling off its Hedge Fund Business to Skybridge Capital LLC. which specializes in startup hedge funds.  The business has been sitting in Citi Holdings, a recent implementation into the Citigroup structure with a number of other assets that Citigroup is trying to sell off or wind down due to the events of the recent financial crisis.  Many of these assets were part of the Sanford Weil acquisition strategy which was implemented in the late 1990’s at Citigroup and bloated the company.  This plan created too many limbs and different strategies which were impossible to grasp and manage over the years and did not help Charles Prince, who in all honesty was not qualified to run such a huge financial conglomerate, never mind a bank. The deal was being talked about since February but seems to be entering final stages.  No actual terms were released.

This is a perfect example of what Citigroup needs to do to reposition itself and strengthen itself as a bank first and foremost again. It is also a far cry from recent testimony at banking related hearings from Charles Prince and others.  The assets which the company determined as not part of the company plan have all been sitting in the Citi Holdings side of the house, awaiting buyers or liquidation.  As the company continues to shed these riskier assets and moves back towards the core banking business it first started out being, investors and customers will begin to see the benefits and financial rewards of the newly re worked and streamlined entity.  In effect, Citigroup is returning to its roots; not a moment too soon and a long overdue decision in my opinion.  CEO Vikram Pandit and future  management will have more transparency and a better stronger management team as a result.

The market seems to be welcoming this news with open arms, and for good reason.  Citigroup appears determined to reverse the issues that bogged it down and nearly sent it to a similar fate as Lehman Brothers.  Citigroup coming back off the mat should be viewed as a good thing, however, shareholders need to stay on top of the situation with all the different situations taking place, from raising cash through new bond offerings for general corporate purposes to new IPOs (Primerica) (NYSE:PRI) in efforts to divest itself of some under performing or non essential assets which came with the merger that occurred through Weil, knowing what is currently going on can lead to some solid profits in this equity.  Primerica (PRI) is up since its initial public offering price of 15 dollars and is trading near the 26 dollar level.  Alas Primerica has apparently gone full circle; and Citigroup intends to totally divest itself of Primerica moving forward.  Continued cautious optimism is advised, as Citigroup continues to return closer to its roots with US Government backing and support as well as continued growth  abroad with obviously improved confidence domestically among retail and institutional shareholders.

Disclosure: Currently no position in C or PRI

By Steve Garcia -

As a precursor to covering Citigroup (NYSE: C) stock, I feel a little history lesson is due.  The history lesson will help to bring us up to today in terms of where they have been, and where the company is headed in the future.  I have been in and out of this stock several times over the years, and have family who have worked for and retired from the company.  There was a time when my family lived and breathed First National and Citibank; a time when this company showed genuine care and passion for what it did and its employees did.  The company no longer holds its employees in high regard, but that will be gone into more in future articles.  I believe it is important to know as much about the company you invest in as possible.  That was never truer than it is right now.  For now, let us look at the history of one of the largest Banking conglomerates ever.

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By Steve Garcia

Today was a day that reminded me just how predatory and evil some Wall Street movers and shakers can be. The negative slant and bias regarding SIRIUS XM and its stock was out there in all its glory with no less than 8..yes that’s correct 8 articles out of 10 bookmarked on YAHOO….all spewing negatives about SIRIUS XM. You’d think it was the only stock in the world that traded with that type of coverage; coverage by the way from Jim Cramer’s own thestreet.com (TSCM) and Realmoney. Take a look for yourself;

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By Steve Garcia

Following Liberty Media Corporation’s 2009 investor meeting last week on the 16^th of October, I was pleasantly surprised to discover Sirius XM Radio CEO Mel Karmazin was scheduled to speak.  Once the meeting got underway though, I truly was not prepared to hear what either Greg Maffei of Liberty or Mel Karmazin of Sirius XM Radio (SIRI) laid out during the meeting.  Rest assured, Sirius XM Radio’s relationship to Liberty Media and John Malone is a two-way door.  Liberty Media gets 40% of the company with exclusive content and can leverage it over multiple possibilities; which I believe they are preparing to do in earnest.  Mr. Maffei’s statements were like music to my ears when he said they were looking for opportunities regarding SIRIUS XM in other markets.  To me it seems that this all is coming together and turning into global expansion with recent news of Liberty buying the debt of Worldspace and also now looking to purchase the hard assets of the company. This action could be seen as removing the hurdle of Spectrum licensing overseas that would be expensive and virtually impossible for SIRIUS XM to procure. More details are sure to come from this developing story as details continue to emerge. As Worldspace seeks to re start asset sale processes with Liberty Satellite Radio LLC, a unit of Liberty Media. Liberty Satellite Radio LLC is in fact a holding company that Liberty Media owns and has used in the past. This ties closely with Sirius XM’s rumored, though not confirmed partnership with APPLE (APPL) and could bring a whole new loyal following as well, likely adding more multi-subscription households.  All this would give lots of those potential subscribers an opportunity to purchase all of the exclusive available channels including, but not limited to, Oprah Radio, MLB Home Plate, NFL Radio, NHL Home Ice, Mad Dog Radio, The Foxxhole comedy channel, and National Public Radio with the purchase of a new SKYDOCK and the possibility of an XM best of SIRIUS package. Seems like a no brainer.

Purchasers will also gain access to a variety of Sirius XM music channels, including E Street Radio, The Grateful Dead Channel, Eminem’s Shade 45, Radio Margaritaville, Siriusly Sinatra, and many others. All (more…)

By Steve Garcia

As the current share price of SIRIUS XM bounces around in the mid to high .50s heading into the Q3 Conference call, many would say it’s just bad timing regarding the price, the economy is still bad, auto sales are still slumping post Cash 4 Clunkers though it did provide a much needed boost and, people are still unemployed in large numbers and scared for their jobs. Having recently lost my job….I can relate to all the uncertainty. While that is all true, and some of it is reflected in the current state of the price per share, there are very positive signs that the Media in general has chosen to pretty much ignore recently.

We saw an upgrade on the EBIDTA forecast for the year from 300 million dollars to over 400 million dollars, from a company which was nearly bankrupt according to their CEO and many media reports back in February. This is not an insignificant achievement by any standard, yet it has also been virtually ignored in the main stream media. More recently, we have seen a used Car program meant to take advantage of all those inactive chipsets that are out there from the past. The release of the iPhone application during the (more…)