FDIC Chairman Sheila Bair Doesn't Want You To Kmow
July 25th 2008 05:48
OnN july 12th in Indymac Follow Up!, I asked.
Now FDIC Chairman Sheila Bair doesn't want you to know this, but according to Mike Shedlock, from his You Know The Banking System Is Unsound When.....
24. There is roughly $6.84 Trillion in bank deposits. $2.60 Trillion of that is uninsured. There is only $53 billion in FDIC insurance to cover $6.84 Trillion in bank deposits. Indymac will eat up roughly $8 billion of that.
25. Of the $6.84 Trillion in bank deposits, the total cash on hand at banks is a mere $273.7 Billion. Where is the rest of the loot? The answer is in off balance sheet SIVs, imploding commercial real estate deals, Alt-A liar loans, Fannie Mae and Freddie Mac bonds, toggle bonds where debt is amazingly paid back with more debt, and all sorts of other silly (and arguably fraudulent) financial wizardry schemes that have bank and brokerage firms leveraged at 30-1 or more. Those loans cannot be paid back.
That means there is $0.02 backing every dollar you have in a bank that says it is protected by FDIC and one bank, Indymac, just ate through $4 to $10 Billion of the $53 Billion
How much would be left of the FDIC $53 Billion after Indymac and a large number of banks go under?
Now FDIC Chairman Sheila Bair doesn't want you to know this, but according to Mike Shedlock, from his You Know The Banking System Is Unsound When.....
24. There is roughly $6.84 Trillion in bank deposits. $2.60 Trillion of that is uninsured. There is only $53 billion in FDIC insurance to cover $6.84 Trillion in bank deposits. Indymac will eat up roughly $8 billion of that.
25. Of the $6.84 Trillion in bank deposits, the total cash on hand at banks is a mere $273.7 Billion. Where is the rest of the loot? The answer is in off balance sheet SIVs, imploding commercial real estate deals, Alt-A liar loans, Fannie Mae and Freddie Mac bonds, toggle bonds where debt is amazingly paid back with more debt, and all sorts of other silly (and arguably fraudulent) financial wizardry schemes that have bank and brokerage firms leveraged at 30-1 or more. Those loans cannot be paid back.
That means there is $0.02 backing every dollar you have in a bank that says it is protected by FDIC and one bank, Indymac, just ate through $4 to $10 Billion of the $53 Billion
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