Bank of America, at the request of counterparties, just moved a Merrill Lynch derivatives unit to an Insured Deposits unit, under protest by the FDIC.The FDIC does not like the move because it puts the FDIC at risk. Bernanke is fine with the move, which means the Fed and FDIC are once again in an open feud about risk management
Read the rest at MISH'S Global Economic Trend Analysis, Bank of America Moves a Merrill Lynch Derivatives Unit to an Insured Deposits Unit (Putting FDIC at Risk); Fed approves Move, FDIC Doesn't
Also, Yves Smith at Naked Capitalism, Bank of America Deathwatch: Moves Risky Derivatives from Holding Company to Taxpayer-Backstopped Depositors (h/t Kevin Fathi)
UPDATE: Trader's Crucible piles on, Can We Prevent a $100 Billion+ BoA Taxpayer Ripoff? There's an important comment of Beowulf originally posted at Yves' place reposted by TC.
Let the outrage begin, or better, increase.