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Strategies & Market Trends : The Residential Real Estate Crash Index
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To: The Reaper who wrote (186083)2/24/2009 7:12:54 AM
From: butschi2Read Replies (2) of 306849
 
Multiply this how many times around the world? There is no way that C can be saved by the Treasury. You just get the feeling they were levered up so much more than 40-1.

Citi will and must be saved. IMHO total cost to taxpayer could be $300-500 billion. Citi is to interwoven in the financial markets on an asset base and much more through their $38.000.000.000.000 ($38 trillion) in nominal value in derivatives.

If you kill Citi you kill the global financial system because i would expect the clearing systems to fall apart.

AIG was deemed worth saving and i find the danger from AIG to the system small, because mostly only OTC-CDS in a 300-400 billion face value. This would have given losses to the counterparties, but there is no myriad of complex finanicals products with and without termination clauses as at Lehman.

Lehman had only a small $1 trillion derivative book. Bear was saved because of their $7 trillion derivatives book.
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