On April 13, Sheila Bair (aka, the woman who just stepped down as head of the FDIC) wrote an op ed in the Washington Post entitled Fix Income Inequality With $10 Million Loans for Everyone! (see link below) Perhaps she is just suffering from PTSD resulting from having to manage bank failures with only $18 million in capital and a $200 billion backstop line of credit from the Treasury, or maybe the gal’s onto something…what do you think? (I suspect that in terms of percentages there are as many shadow bank failures waiting in the wings as there are shadow homes waiting to be foreclosed upon)
P. S. If you think that’s bad, SIPC only has $100 billion in net assets and has NO GOVERNMENT GUARANTEE. Most people don’t know that when you execute a sell trade in your brokerage account it takes three days to clear to cash. During that time frame (and afterwards if you have not specifically designated that the cash held in your brokerage account be held in an FDIC insured account), you are vulnerable in a way that only MF Global customers can truly understand.