The real number is 78 billion 2nd quarter, 26 billion 1st quarter - 200% increase in a quarter are the sorts of numbers that should really spark a Dow rally.

Entirely baseless speculation: Does the FDIC have the auditing chops to correctly value and model modern financially engineered products?

For example, what exactly is the risk for a large bank holding synthetic CDOs (composed of credit default swap agreements).

I would imagine that the FDIC staff is trained and most capable of recognizing problems in 'traditional' loan portfolios.

@FFDIC: What would you is the FDIC's ability in valuing unusual items on bank balance sheets?

Some CRE data from the report:

% C&D loans, 20-89 days past due: 2.01
% C&D loans, 90+ days past due : 6.08
% C&D loans, charged off : 1.66

Well on the $78 billion number alone it's pretty clear WAMU and Wachovia are not on the list. IndyMac was also never on the list. So I spit on your list FDIC!

We are all insolvent now.

"Fed Officials Agree Next Rate Move Will Be Increase (sometime in 2012)"

The only question then is will inflation be 12% or 120% at that time.

they are just trying to pile on a commodities price decrease. all we need is another whooper of a bank failure and we'll get more rate cuts, more bank failures and more inflation.

OT:
Aug. 26 (Bloomberg) -- Carteret Mortgage Corp., a closely held mortgage broker that originated more than $4 billion in loans in 2006, plans to close in several weeks, said Chief Executive Officer Eric Weinstein.

We ran out of money,'' Weinstein, 49, said in an interview today.We're not technically out of business yet, but we're winding it down and trying to do the best we can for everybody.''

More than 100 lenders that have halted loans, closed or sold themselves over the past 18 months amid the worst housing market since the Great Depression. Weinstein said the Centreville, Virginia-based company has about 800 employees, including 40 at headquarters.

You should definitely seek other employment immediately,'' Weinstein said in an e-mail today to the employees.I would expect that you have about 30 days to close your loans before it starts getting bad,'' he said, signing the note ``Eric `Shut the Lights' Weinstein.''

Foreclosures are expected to hit a record 2.5 million this year and next, according to the Mortgage Bankers Association, cutting demand from investors who buy mortgage-backed assets.

Weinstein founded the company in 1995 and expanded to more than 4,500 employees by 2003 when annual loan volume peaked at more than $4.7 billion. The company's business model allowed employees to work from home and earn income by recruiting and managing other workers, Weinstein said. - Bloomberg

Love that last sentence in the article, a little ponzi scheme no less!

is LEH setting up an Everquest?

Everquest IPO tied to troubled Bear hedge fund
Cioffi's fund transferred risky mortgage derivatives to firm he helps run
Everquest IPO entwined with troubled Bear Stearns hedge fund - MarketWatch

how is this legal?

here is a point from the bloomberg article.

"Lehman may contribute some of the equity for the new venture so it could benefit should asset prices recover, the people familiar with the talks said."

Doesn't LEH need to raise money?

OT:
Aug. 26 (Bloomberg) -- Evacuations of offshore oil and gas rigs and platforms in the Gulf of Mexico will begin tomorrow in preparation for Hurricane Gustav, which may become the strongest storm to hit the region in almost three years.

Royal Dutch Shell Plc is ``making logistical arrangements to evacuate staff who are not essential to production or drilling operations,'' spokesman Destin Singleton said in an e-mailed statement today.

Shell generally leads off'' the evacuations, said Jim Shugart, executive vice president of ERA Helicopters LLC, which ferries workers to and from offshore facilities.They have by far the majority of workers out there and they figure it takes them four to four and a half days to evacuate everybody.''

Those rigs will be close a long time as this storm won't even clear Cuba until Friday or Saturday. Katrina meet Gustav, Gustav meet Katrina, I think you guys would really hit it off and have a lot in common.

I love the last sentence on the "About the FDIC" blurb, about how no taxpayer dollars are spent bailing out the banks. It reminds me of the annual Social Security statements the government sends me which are always good for a chuckle. "You'll receive such-and-so per month" with the footnote "btw, benefits might change from projected, because we'll be totally broke by then if they don't."

Sad that the American people are so dumb that the whole "everything will be fine, rah rah" rhetoric with no substance elicits praise and not ridicule. Sign of the times, I guess.

It should be noted that that list includes failed institutions one of which is indymac with their roughly $32bn of assets.

Spiral away.

Lets see. Wamu's CAMEL rating.

Capital - still adequately capitalized, but unable to raise new capital in the market to meet expected losses. Stock price $3.60.
Assets - 60 B Home Equity Loans and 55 B Option ARM loans most in California and Florida.
Managment - What management?
Earnings - Multibillion losses as far as the eye can see.
Liquidity - Paying 5% on 1 yr CDs, can't issue commercial paper or other debt instruments.

Hmm, what CAMEL rating would you give them?

[non-facetious] Give Secretary Bair credit for making a frank scary statement just before the Repub. Convention.

Profits down 86% for Banks, time to start floating DEPRESSION ODDS the "R" word is now redundant....

$78B/117 = $666M per problem bank on average.

The actual quote was...
Total assets of problem institutions increased from $26 billion to $78 billion, with $32 billion coming from IndyMac Bank, F.S.B., Pasadena, CA, which failed in July.

I take that mean that the $78 billion includes IndyMac. Subtracting out IndyMac gives a slightly different picture...
$46B/116 = $396 million per bank (on average). Seems there are quite a few Podunk National's with problem loans.

5% on a CD - sounds great, but it also sounds desperate. No thank you.

Fannie, Freddie Mortgage Profit Rises With Debt Costs (Update2) - Bloomberg.com

Washington-based Fannie said last month net interest income rose to $2.1 billion in the second quarter, from $1.7 billion in the first quarter. The company's profit on its investments expanded to 100 basis points from 82 basis points, according to Credit Suisse.

Freddie's net interest income jumped 92 percent to $1.5 billion. The annualized profit per dollar of investments rose to 80 basis points from 48 basis points.

They, at the increment, are very, very profitable,'' said Dan Fuss, vice chairman of Loomis Sayles & Co. in Boston and co- manager of the $17 billion Loomis Sayles Bond Fund.If they can continue to do anything close to business as usual, they are immensely profitable.'