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The Big Long

John Paulson, the hedge fund manager who made billions betting against the housing market a few years back, has now made more than $1 billion for his fund by betting on Citigroup, Bloomberg News reports.

Paulson's fund invested in Citi in the middle of 2009 — not long after the stock market bottomed out. The firm, which still holds a big stake in Citi, apparently thinks the comeback will continue this year. "We believe the U.S. economy is recovering and we anticipate continued growth," the fund said in a recent letter to investors, according to Bloomberg.

During the financial crisis, Citi got a $45 billion government bailout. In exchange for the bailout money, the government got a big ownership stake in the bank. The government, which has been selling off its stake as the financial system has stabilized, has made a profit of about $12 billion on the Citi bailout.