Submitted by Elaine Magliaro, Guest Blogger
In an article titled Another Weapon for OWS: Pull Your Money Out of BofA, Matt Taibbi wrote that “when it comes to commercial banking, Bank of America is as bad as it gets.” He said he believed the markets seemed to agree as the bank had a credit downgrade recently “to just above junk status.”
He continued: The only reason the bank is not rated even lower than that is that it is Too Big To Fail. The whole world knows that if Bank of America implodes – whether because of the vast number of fraud suits it faces for mortgage securitization practices, or because of the time bomb of toxic assets on its balance sheets – the U.S. government will probably step in to one degree or another and save it.
After the credit downgrade in September, Bloomberg reported that Bank of America “moved derivatives from its Merrill Lynch unit to a subsidiary flush with insured deposits…” Taibbi said the transfer involved trillions of dollars in risky derivatives contracts.
Continue reading “Bank of America & The Great Derivatives Transfer” →