Wednesday, October 15, 2008

Topics For Discussion I

Not included in this tally is the amount of U.S. Treasury Securities that will need to be issued to pay for the rescue packages that have been announced. $200 billion has been committed to the conservatorship of Fannie Mae & Freddie Mac. Although the agreement stops short of an explicit government guarantee, the U.S. Treasury may be on the hook for the $ 6.1 trillion in Fannie & Freddie debt and mortgage guarantees outstanding. The U.S. Treasury needs to raise funds to pay for the $ 700 billion for the Emergency Economic Stabilization Act of 2008. The FDIC is woefully under capitalized and has the option to tap a credit line with the U.S. Treasury. AIG was the recipient of an $85 billion loan and a $38 billion collateralized loan. Please refer to the September post "How Much is TOOOOOOO Much" for additional discussion. Click on the graphs to expand.

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