The Corner

Who Will Stop Sheila Bair?

Hasn’t anyone noticed her insidious campaign to impose socialism on the American economy? Here:

 

The sale of Wachovia’s banking business to Citigroup yesterday marked the second time in five days that a major U.S. bank was forced from existence in part by fleeing depositors, raising serious questions about the stability of other financial firms and the health of the banking system….

Citigroup, based in New York, would become the largest bank in the Washington area. The deal would protect all deposits at Wachovia, according to a statement from the Federal Deposit Insurance Corp., which presided over the companies’ shotgun wedding.

To consummate the deal, the FDIC promised to limit Citigroup’s losses on a $312 billion portfolio of Wachovia’s most troubled loans. The government agreed to absorb all losses beyond $42 billion, a threshold that could be exceeded based on the performance of similar groups of mortgage loans at other banks.

In exchange, the government would get a $12 billion stake in Citigroup, making it one of the largest shareholders in what would be the nation’s largest bank. Sheila C. Bair chairman of the FDIC, said the government’s involvement was necessary “to maintain confidence in the banking industry given current financial-market conditions.”

Seriously, isn’t this closer to socialism than the government buying assets and eventually selling them off? Meanwhile, out in the real world, she seems to be one of the few people performing ably in this crisis.

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