FDIC to tap into US Tres?

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FDIC to tap into US Tres?

From Bloomberg


Bair Says FDIC Is Considering ‘All Options’ on Insurance Fund


By Gregory Mott

Sept. 18 (Bloomberg) -- Federal Deposit Insurance Corp. Chairman Sheila Bair said the agency may consider tapping its Treasury Department line of credit as it examines “all options” for replenishing a deposit insurance fund being tapped by bank failures.

Bair made the comment today at a Georgetown University conference in Washington.

Well this is no news flash.

Looks like Shiela is floating a trial balloon.

It's not a question of "If" but "When" and "How much".

It looks like we are going to be realizing a little more of that $23.7 Trillion dollar TARP liability the OIG reported on.

The real question, though, is how long are the Central Banks going to continue to support this growing debt?

The upcoming T auction results will be interesting to watch.

Bloomberg wrote:

‘Higher Uncertainty’

The U.S. plans to sell $43 billion in two-year notes on Sept. 22, $40 billion of five-year debt on Sept. 23 and $29 billion in seven-year securities on Sept. 24. The $112 billion will be a record for that combination of maturities, besting the $109 billion of 2-, 5- and 7-year debt sold the week of Aug. 24.

President Barack Obama has increased the U.S. public debt to an unprecedented $6.94 trillion to fund spending programs aimed at snapping the economic slump and service record deficits.

“Rising auction sizes, coupled with lower dealer shorts, have led to higher uncertainty around auctions,” Anshul Pradhan, an interest-rate strategist in New York at primary dealer Barclays Plc, wrote in a note to clients. “A larger than usual concession needs to be built, which gets reversed later.” A short is a bet the price of a security will decline.

The Treasury raised $1.2 trillion in new cash this year through sales of debt, according to government data. The federal budget deficit will total $1.6 trillion this year as revenue falls and the government spends at the fastest pace in 57 years, according to the nonpartisan Congressional Budget Office.

Is anybody here tracking and posting the bid/cover ratios somewhere on the boards?

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