What We're Hearing

Now that Citigroup's earning a ton of money again, the next question becomes: what about Fannie Mae and Freddie Mac? Not so fast. First let's look at today's "Citigroup Rally." At press time the stock market was soaring because Citigroup's CEO Vikram Pandit "leaked" a company letter that said the bank had an operating profit of $8.3 billion before taxes and special items through February -- its best performance since 3Q 2007. "Special items" might include hits to its subprime and CDO portfolio. In other words, that $8.3 billion may not look so impressive if writedowns wipe out most that profit. Then there's Citi's commercial real estate portfolio to think about. And what about all those European loans? But let's just say Citi does turn a profit in 1Q. Does that mean the GSEs might soon do the same? (Citi, Fannie and Freddie are all huge players in home mortgages, including subprime.) Meanwhile, according to new estimates made by Zacks Equity Research of Chicago, Freddie will lose $39.50 per share in 2008 (the government controlled company has yet to report earnings), and $13.12 per share in 2009…