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Bank Of America To Use Taxpayers... Again

That's right folks, without regulatory approval, Bank of America has moved trillions of dollars of Euro derivatives into their depository where it is backed and protected by the FDIC. Or as we liked to call it in the Marine Corps, we're getting the big green weenie.
This story from Bloomberg just hit the wires this morning. Bank of America is shifting derivatives in its Merrill investment banking unit to its depository arm, which has access to the Fed discount window and is protected by the FDIC.

This means that the investment bank's European derivatives exposure is now backstopped by U.S. taxpayers. Bank of America didn't get regulatory approval to do this, they just did it at the request of frightened counterparties. Now the Fed and the FDIC are fighting as to whether this was sound. The Fed wants to "give relief" to the bank holding company, which is under heavy pressure.
Oh, and it doesn't stop there. BofA isn't the only institution doing this. JP Morgan is moving up to $79 trillion in European derivatives to where they will have protection from the FDIC.
It appears that the banks are relying on the Too Big To Fail mentality of the Teasury Department, and the legislators in Washington to have little choice but to institute a bailout of massive proportions should these derivatives be called in for Euro failures. Only this time, the cost would be 10 times the amount taxpayers spent bailing out institutions during the 2008 credit crisis.

For the American people, these moves by Bank of America and JP Morgan should be severe warnings to just how bad the global credit crisis is becoming, and the potential for over $100 trillion in derivatives to be thrust on the US taxpayers. It is ironic that Merril Lynch once again is the center of controversy for too big to fail, but this time, there may not be enough dollars in circulation to save the banks should the worst case scenario come to pass.
You wanted to know how you can destroy the most powerful country this world has ever seen? I give you the banking institutions. I have been pretty much ignoring this "Occupy Wall Street" movment, but maybe I'll take this guy's advice: