We worried some weeks ago about what the FDIC, who's capitalization is awfully small to look very useful against any serious glut of bank failures, was going to do if things started to fall apart. It appears we have our answer:
The Federal Deposit Insurance Corporation is seeking temporary unlimited borrowing authority from the Treasury Department, according to a copy of the final Senate bailout legislation on Wednesday.
The saving grace here is that FDIC actually seems to know what the hell it is doing. Not only that, but they seem to have a particular affinity for public relations and youth outreach. We badly want to make (more) fun of Chairwoman Bair, but since there are so few heros and heroines in "crisisland," we can't bring ourselves to rock the boat. Have your unlimited borrowing authority, Bair. Use it well.
FDIC seeking temporary unlimited Treasury loans [Reuters]