Bleeding banks prompt talk of new big U.S. bailout

Reuters ^ | Jan. 27, 2009 | Kevin Drawbaugh

[ConservativeMind]

But the bank runs would, at most, take out 10% of the reported assets of the bank (as banks leverage savings/CDs/MM at 10:1 for loans going out).

The “lost” and partially “lost” assets, along with all the good assets in loans, will be left to the stockholders and bond holders to fight over in bankruptcy.

For the savings and checking account holders, let the FDIC bail them out. 10% of a mess is much less than 100%.

[cripplecreek]

My credit union seems to be doing fine too. Wonder why that is? LOL

[Orange1998]

For the short term a “bad bank” would rally financials.

[Nuc1]

Nice post. A post this weekend on FR was an examination of the world banking system. It was not good and the situation was growing worse not better. A question was raised as to how we would know the collapse occurred. A bank holiday and government types fleeing to their bunkers were mentioned. The most likely scenario however was no warning. One would wake up one morning and the banks would be closed, the ATMs would not work, credit cards would function and everything would be cash, barter or precious metals. A PHD at work indicated the New Yorker had an article about the Russian collapse where alcoholic beverages were the temporary currency. An interesting take. For warned is for armed.

[rsobin]

What I would like to know , that is if any info on the subject is available; who are the major beneficiaries of these CDS payouts. These derivatives probably are much more deleterious to the banks balance sheets than are the collateral write downs, in other words, somebodies are getting very very very rich on CDS payouts. Who?

[Swordfished]

Let them die, give the free market a chance instead of throwing Billion upon Billions at them.

What "free market"? I don't see it anywhere, especially if this charade continues.

[blam]

bfl