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FDIC May Need 150Billion Bailout

I don't know if this was posted already but I hadn't seen it. DP'ers have been pointing to the inevitability of this for a while now.

http://www.bloomberg.com/apps/news?pid=20601170&refer=home&s...

By the end of 2009, about 100 U.S. banks with collective assets of more than $800 billion will fail, predicts Christopher Whalen, managing director of Institutional Risk Analytics, a Torrance, California-based firm that sells its analysis of FDIC data to investors.

``It's not going to be Armageddon,'' says Mark Vaughan, a financial economist at the Federal Reserve Bank of Richmond, Virginia and a senior lecturer in economics at Washington University in St. Louis. ``But it's going to be bad.''

FDIC's Secret List

The FDIC knows which banks are at risk; it has a watch list with 117 institutions. The agency won't disclose their names because doing so could cause depositors to panic and pull out all of their funds.

It won't take many more failures before the FDIC itself runs out of money. The agency had $45.2 billion in its coffers as of June 30, far short of the $200 billion Whalen says it will need to pay claims by the end of next year. The U.S. Treasury will almost certainly come to the rescue by lending money to the FDIC.

Regardless of who wins control of the White House and Congress in November, no politician is likely to vote in favor of leaving federally insured depositors out in the cold.

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Time to get one of those

take a number machines they have in grocery stores so we can make sure everyone gets their handouts from us in proper order. We need to discourage any pushing, shoving or taking cuts in the line. Don't forget the FOREIGN banks and institutes they want to include in the bailouts too.