Citigroup Inc. (NYSE: C), the beleaguered financial giant with a completely ineffective CEO at the helm, will report quarterly earnings (or losses) tomorrow. Most likely, we will see yet another company taking steep losses due to bets on mortgage-backed securities and other goofy investments. When Citigroup kicked former CEO Chuck Prince out the door, his replacement was even more strange. Citigroup is floundering to this day, although I have no doubt the banking and investment giant will recover.

Citigroup's shares are currently at the lowest level since the company was formed a decade ago. It announced the sale of its German banking business for $7.7 billion just last week, and now analysts polled by Zacks are expecting a net loss of $0.42 per share when the finance behemoth announces quarterly results this Friday. Reuters estimates that losses could go as high as $0.60 per share. Regardless of the loss, either would be quite a drop -- over 134% to be exact -- from the company's year-ago EPS figure of $1.24.

What will Citigroup do? Well, it will continue digging itself out of the hole it's responsible for, just like every other finance company that bet the shaky farm on every Tom, Dick and Harry getting a $600,000 mortgage with a $50,000 annual income. In addition to selling off some assets in Germany, Citigroup is shedding some Japanese assets as well as saying it may be two or three years before its returns come back to favorable levels.

Do you own Citigroup shares? If so, are you holding on for the long run or have you sold them already?

Xerox Corporation (NYSE: XRX) announced yesterday that it had elected Chuck Prince to its board of directors.

Yes, that Chuck Prince: the one who presided over a rapid decline in Citigroup Inc (NYSE: C)'s financial position and was forced to step down in November -- with $94 million in stock, a $1.74 million pension, and other assorted goodies. Then he was hauled before Congress to explain himself.

Why exactly would you want this guy on your board of directors? If you're a shareholder, I can't even imagine. But if you're the CEO, he'd be a great "watchdog." And the company's CEO, Anne Mulcahy, is also the chairman of the board. In the press release announcing his appointment, she said that "Chuck is a visionary leader whose unique talent and exceptional business experience will be a tremendous asset to our board."

Visionary? I'm actually inclined to agree. To lead the destruction of value at America's largest financial institution and then leave with 9-figures requires tremendous vision. If I were a Xerox shareholder, I'd be insulted.

MAJOR PAPERS:

• In what may trump a GBP1.6B bid from a private-equity led consortium consisting of The Goldman Sachs Group Inc's (NYSE: GS) Goldman Sachs Capital Partners, Candover Investment (OTC: CDRIF), and Alpinvest, Expro International Group (OTC: EXPRF) said it received a GBP1.71B bid proposal from Halliburton Company (NYSE: HAL), the Wall Street Journal reported. Expro said the proposal "does not amount to a firm intention to make an offer and is subject to certain preconditions."
• The Wall Street Journal also reported that the oil industry and some U.S. lawmakers are looking to end long-standing bans on domestic drilling put in place to protect areas that are environmentally-sensitive, fueled by concerns about global energy.
• In an interview with the Financial Times, Citigroup Incorporated's (NYSE: C) former chairman and CEO Sandy Weill acknowledged that choosing Chuck Prince as his successor in 2003 turned out not to be the "right thing" for the company and was flawed. Instead of handing the job to Prince, Weill said the board should have fostered competition among the bank's top managers for the job.

OTHER PAPERS:

• According to the Washington Post, MedImmune, a unit of drug giant AstraZeneca Plc (NYSE: AZN),settled with Genentech Inc (NYSE: DNA) a lawsuit over a patented component of its best-selling drug Synagis, which is aimed at preventing respiratory infections in infants. No details of the settlement were provided.

My first reaction to the news today that Citigroup (NYSE:C) has settled claims by Enron creditors to the tune of $1.66 billion due to their responsibility in Enron's downfall, was that the two firms were meant for each other.

According to the Reuters report: " The largest U.S. bank is also giving up $4.25 billion of claims against Enron, while Enron is releasing all claims against Citi. The bank said in a statement that it denies wrongdoing, and agreed to the settlements solely to avoid the expense and uncertainty of litigation."

Uh huh. No wrongdoing. Just like it bears no responsibility in the whole subprime mess? Why is it that shareholders are the ones always left holding the bag? Investors in Citi have lost over 60% of their money over the last year. That hasn't stopped the board from paying huge bonuses to senior executives, and sending off former CEO Chuck Prince with a huge parting gift.

Enron didn't take any responsibility, Citigroup won't take any responsibility. Who are the ones who end up taking responsibility? Once again it's the little guy who is left holding the bag.

Aaron Katsman is the lead Portfolio Manager and Managing Director of America Israel Investment Associates, LLC. and Senior Editor of IsraelNewsletter.com. DISCLOSURE: Writer's fund has no position in any stock mentioned, as of 3/26/08

TheStreet.com's Jim Cramer says AIG's Sullivan joins the "formers" at Citi and Marsh & McLennan as Eliot Spitzer's appointee failures.

Three strikes, and Spitzer's guys should all be out.

That's my thoughts about this Martin Sullivan/AIG (NYSE: AIG) (Cramer's Take) scandal. Remember that Sullivan was basically appointed to run AIG by Eliot Spitzer after he kicked out Hank Greenberg for a laundry list of bad deeds. Just like Chuck Prince was appointed to run Citigroup (NYSE: C) (Cramer's Take) when Spitzer booted Sandy Weill, and Mike Cherkasky was appointed to run Marsh & McLennan (NYSE: MMC) (Cramer's Take) when Spitzer axed Jeffrey Greenberg.

All three men were brought in to clean up the mess. Both Prince and Cherkasky were lawyers who were way over their heads as operators.

Prince presided over the destruction of a great American bank -- although it was kind of a re-destruction in light of how bad it was in 1990 -- when he allowed billions in off-balance-sheet borrowings that he simply did not understand.

Former Citigroup (NYSE: C) Chief Executive Chuck Prince isn't going to feel the pinch of the worst real estate market in a generation that he helped create.

Prince has put his place in Greenwich, Connecticut -- a tony New York City suburb that is home to countless hedge funds and celebrities such as Tommy Hilfinger and Regis Philbin -- up for sale at the asking price of $6.15 million, according to Bloomberg News. The Tudor-style manor house was sold in 1996 for $2.27 million, according to ZIllow.com. By my calculations, that would be a profit of 170%.

Too bad that most homeowners aren't as fortunate as Mr. Prince. The National Association of Realtors is due to release its figures for December home sales later this week, and it isn't going to be pretty. Economists surveyed by Bloomberg News expect sales to have fallen 1% to 4.95 million, the fewest since records began in 1999.

The former Wall Street hot-shot, though, doesn't need to concern himself with the needs of ordinary folks anymore. He was pushed out the door at Citigroup with a retirement package worth about $60 million. "By retiring rather than being fired, he preserved the right to keep about 743,640 Citigroup shares with a market value of about $26.7 million, compensation consultant Brian Foley based in White Plains, New York, said at the time," Bloomberg notes.

Prince's realtor told Bloomberg that the Greenwich house, which includes an entrance hall with barrel-vaulted ceilings, an exercise room with a sauna and shower and a dining room that sits 12, "no longer meets his needs." Prince also has a place on New York's Park Avenue.

It must be nice to be able to live your life not having to face the consequences of your actions.

It seems like everybody loves to whine about how much CEOs earn, especially when they bank after screwing up big time. Some recent examples include E*Trade (NASDAQ: ETFC)'s Mitchell Caplan securing $11 million, Countrywide Financial (NYSE: CFC)'s Angelo Mozilo corralling $110 million, Citigroup (NYSE: C)'s Chuck Prince snagging $140 million and Merrill Lynch (NYSE: MER)'s Stanley O'Neal pocketing a cool $161 million. Boo hoo, what about the poor shareholders?

Forget the shareholders, I say more power to these CEOs! That's right, quit your whining and accept it -- Wall Street is all about taking as much as you can, there's no compassion involved and anybody who thinks differently is in for a big surprise.

Maybe you should be congratulating these executives on their ability to get to the top and get paid for their efforts. So what if their stocks drop and all their plans go up in flames -- why shouldn't they be compensated for all their hard work and the sacrifices they've made over the years? Over the past two decades, you lazy buy-and-hold shareholders have been spoiled with excess returns, and now that you're losing, you're angry that not everyone is down in the pits with you.

Is it better to invest in a company whose CEO is a star or a company that breeds generations of outstanding CEOs? If you think a star CEO is better, I have two stocks to consider -- but also one to avoid. And if you think a CEO breeding ground is better, one stock comes to mind.

Today, I appeared on CNBC's Squawk Box this morning with Yale's Jeff Sonnenfeld to give my picks for the three best and worst CEOs of 2007. Here are the three best CEOs along with the name of the company, the stock price performance over the last year, and my reasons:

• Steve Jobs of Apple Inc. (NASDAQ: AAPL) +144%. Successful iPhone introduction with a million units sold in its first 74 days (some estimate Apple will announce it's sold five million in mid-January) plus outstanding performance of Apple retail stores -- they account for 20% of Apple revenue and those revenues have grown 42% in the last year while the stores earn $4,000 per square foot -- much more than competitors. At a Price/Earnings to Growth (PEG) of 1.8 it remains to be seen whether Apple can grow enough to justify its P/E of 50.
• Warren Buffett of Berkshire Hathaway Inc. (NYSE: BRK.A) +28%. Berkshire's stock had a great year -- it has not done as well since 1998 when it rose 52%. Berkshire's return on equity is up from 11% in 2006 to almost 16% as of September. Berkshire is a safe haven stock and Buffett continues to find places to invest his $47 billion in cash. One caution -- Barron's thinks that Berkshire stock is 10% overvalued.
• Lloyd Blankfein of Goldman Sachs Group (NYSE: GS) +6%. Only firm to make money while peers lost billions -- its short position of the ABX index--which represents a basket of credit default swaps on mortgage-backed securities- yielded $4 billion in profit -- offsetting a $2 billion loss in its $10 billion CDO portfolios. I was impressed by the way Blankfein carried Goldman's culture of encouraging intellectual debate between lower-level traders and top executives to arrive at the best decisions. Goldman trades at a P/E of 8.6 and its earnings are expected to grow 4% next year. But that forecast is a real toss up so if you buy the stock, take a long term view.

BloggingStocks readers and AOL Money & Finance visitors have spoken, and below are the Best & Worst of 2007. (See the individual posts for full results.)

Company of the Year: Google, internet search provider turned diversified services giant, received 51% of the vote, beating such strong contenders as Apple and Coca-Cola.

Hottest Gadget of the Year: After all the hoopla surrounding the launch of the iPhone, it's no big surprise that it tops this category, with 47% of the vote, besting second place finisher the Nintendo Wii.

Dumbest Celebrity Feud: Rosie O'Donnell's squabbles with Donald Trump (and also with Elizabeth Hasselbeck) garnered 66% of the vote, easily beating out the back-and-forth between Britney Spears and her ex, Kevin Federline.

Hottest Car of the Year: The Cadillac CTS led with 43% of the vote, easily beating the BMW M3 and others in this category.

Dumbest Moment in Business: JetBlue's stranding of passengers on a cramped, grounded airliner for hours netted 51% of the vote.

Its been a tough year for Chuck Prince, whose four-year reign as CEO of Citigroup Inc. (NYSE: C) finally came to an end in November.

Right from the beginning of the year, there were calls for Prince's resignation and for Citigroup to be broken up. Prince did step up and clean house at Citi in the spring, in a move that many thought was draconian. But the effort to make things more effcient seemed to be working when Citi reported good second quarter results in July.

However, Citi couldn't avoid the mortgage meltdown, and things took a turn for the worse for Citi in later summer. By the time the dismal third quarter results were released, there were more calls for Prince's ouster, even though all the big banks had been hit hard as well. There was a management shakeup in October, but Prince held on to his position at the top.

When Stan O'Neal, CEO of rival Merrill Lynch (NYSE: MER) was forced out, it appeared that the writing was on the wall for Prince. That proved to be the case, but, like O'Neal, Prince went out with a nice severance ($140 million) despite his failures. That didn't save him from being included in a suit filed by Citi shareholders, however. The share price has fallen from more than $55 at the begining of the year to a three-year low of $29.50 at the end of November.

So it's probably no surprise that Prince was recently voted one of the best CEO departures of the year by BloggingStocks readers.

Be sure to check out other Money Losers of 2007.

As expected, Citigroup Inc. (NYSE: C) today named Vikram Pandit as its new CEO, replacing the hugely unpopular Charles Prince. Acting CEO Win Bischoff replaced former Treasury Secretary Robert Rubin as chairman. Rubin didn't want the job permanently.

As pundits including CNBC's Charles Gasparino pointed out, Citigroup's board didn't feel that Pandit had enough experience to get both jobs. That's no slight against Pandit, who joined New York-based Citigroup after selling the company his hedge fund for $900 million. Few if any people are experienced in the huge variety of business at Citigroup which is why Pandit says "simplifying the company's organizational structure and aligning our businesses and resources with appropriate goals and economic realities will be among our initial priorities."

So what does that mean?

Will Citigroup exit its retail business and focus on corporate banking? Are more job cuts coming down the pike? Investors are demanding quick answers to these and many other questions.

``They need somebody who can get in there and put some color on exactly where the risks are and what they're doing to address that,'' Johnson Asset Management analyst William Fitzpatrick, told Bloomberg News. ``The stock's been in freefall for the last couple of months.''

Shares of Citigroup, which are down 40% this year, fell further today with other financial stocks amid disappointment over the Fed's rate cut announcement

The New York Times reports that Citigroup Inc. (NYSE: C) is considering charisma as a test for its next CEO. And Vikram Pandit, the PhD in Finance and former professor, is thought to lack charisma -- thus lowering his attractiveness as a choice.

I have limited enthusiasm for Pandit because he has no experience managing a consumer bank, but I don't understand why charisma is a concern. Did Chuck Prince have charisma? If charisma is so important to Citigroup's board, why not hire George Clooney or Brad Pitt? Why not Angelina Jolie or Julia Roberts?

The fact that Citigroup is having so much trouble filling its CEO position tells me that the concept of Citigroup -- as it's currently organized -- is fraught with more peril than opportunity. The most capable potential candidates -- such as Treasury Secretary Hank Paulson who oversaw a great run at Goldman Sachs Group (NYSE: GS) -- must be put off by the black hole of unknown financial problems and the complexity of managing Citigroup's warring fiefdoms.

The suggestion that Citigroup is considering charisma in its decision makes me think it needs a board overhaul.

Peter Cohan is president of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter. He owns Citigroup shares and has no financial interest in Goldman Sachs.

Citigroup Inc. (NYSE: C) may name Vikram Pandit, the former Morgan Stanley (NYSE: MS) executive who sold his hedge fund to the New York-based financial services giant for $800 million in July, as the company's new CEO this week, according to various media reports.

The leak of Pandit's front-runner status is an interesting one. Clearly, the beleaguered Wall Street firm thinks that his appointment as CEO is going to be criticized by shareholders, so it decided to "get ahead of the story."

The problem, it seems, may be with former Treasury Secretary Robert Rubin, who became chairman after Chuck Prince was ousted. Rubin doesn't want the job permanently, which raises the question of whether Citigroup will ask him to stick around for a while if Pandit becomes CEO, whether it names a new chairman or whether it gives Pandit both jobs from the start, according to the Wall Street Journal.

Citigroup is in a pickle.

Shareholders abhor a leadership vacuum, but want the next CEO to be someone with whom they have absolute confidence. But if CItigroup doesn't give Pandit both jobs or a clear path toward both jobs, there is a good chance that he will be hired away by a rival firm.

We recently took a look at the Best & Worst of 2007 in sixteen categories and asked you to vote for your favorites, as well as sharing the reasons for your picks and any other contenders we may have overlooked. And voting is off to a strong start, with more than 100,000 votes in each category so far.

Some categories have shaped up to be close races. Chuck Prince, Bill Ford, and Bob Nardelli each have a little less than a third of the vote for Best CEO Departure of the Year. Britney Spears and Michael Vick are neck and neck as the Celebrity Most Likely to Lose It All, while Lindsey Lohan's relatively low profile recently has garnered her just 6 percent of that vote. In the Most Shameless Attempt at Cashing in on '15 Minutes', Sanjaya Malakar has a slim lead over Howard K. Stern/Larry Birkhead, but poor Chris "Leave Britney Alone!" Crocker has gotten no respect with a mere 6 percent of the vote. McDonald's has a small lead as the Hottest Chain Restaurant, thought Chipotle isn't far behind with more than a quarter of the vote. And while the iPhone has the lead now as the Hottest Gadget of the Year, it and the Nintendo Wii have been trading places as the front runner.

This post was part of AOL Money & Finance's Best & Worst of 2007. Voting has now closed and, in a close race, readers have chosen Chuck Prince as the best CEO departure of the year. Let us know in the comments if you are pleased with this result.

When looking back at 2007, there were some larger-than-life CEO departures that semi-rocked the business world and brought some investors to the realization of over-the-top compensation yet again. Let's look at a few and then you can decide the winner. Sound good?

First up comes Bill Ford, Jr., from the automotive industry. Under Ford's leadership, Ford Motor Co. (NYSE: F) lost its way in terms of correctly forecasting what kind of vehicles customers actually wanted, in addition to becoming horribly leveraged. As soon as gas prices began shooting up, Ford Motor started spiraling down. Long-time Boeing Co. (NYSE: BA) executive Alan Mulally was brought in to replace Ford as the automaker's CEO just in the nick of time. Ford Motor's expected profitability date with Ford now gone: 2009.

How about Bob Nardelli, formerly CEO of Home Depot Inc. (NYSE: HD)? Nardelli made global headlines by making tens of millions while leading Home Depot shares to the basement and apparently making all kinds of bad decisions that finally led to his ouster this year. On top of that, his severance package made a Brad Pitt paycheck seem like pennies, and Home Depot shareholders paid for it. Did Home Depot stakeholders get a voice in this corporate travesty? A small one, perhaps.