The Bank of America was downgraded by the Moody’s credit agency last month. It has transferred derivatives from its brokerage subsidiary (Merrill Lynch) to another subsidiary full of insured deposits. The Federal Reserve appears to approve of these derivatives transfers, which would give relief to the parent Bank of America holding company. The Federal Deposit Insurance Corporation appears to disagree, since FDIC would be obligated to pay depositors in the event of bank failure, indirectly using FDIC money for derivatives. Bank of America itself, according to knowlegeable observers, doesn’t believe regulatory approval is needed for the transfer.
http://www.bloomberg.com/news/2011-10-18/bofa-said-to-split-regulators-over-moving-merrill-derivatives-to-bank-unit.html
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The stock market had been down sharply on Monday’s trading. The major indexes rebounded nearly completely today, Tuesday, though these Bank of America transfers were not mentioned in the headlines as involved in the day’s optimism. The derivatives transfers between the Bank of America subsidiaries were reviewed very shrewdly and negatively at this link:
http://www.zerohedge.com/contributed/federal-reserve-and-bank-america-initiate-coup-dump-hundreds-billions-dollars-losses-ame?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+zerohedge%2Ffeed+%28zero+hedge+-+on+a+long+enough+timeline%2C+the+survival+rate+for+everyone+drops+to+zero%29
http://www.bloomberg.com/news/2011-10-18/bofa-said-to-split-regulators-over-moving-merrill-derivatives-to-bank-unit.html
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The stock market had been down sharply on Monday’s trading. The major indexes rebounded nearly completely today, Tuesday, though these Bank of America transfers were not mentioned in the headlines as involved in the day’s optimism. The derivatives transfers between the Bank of America subsidiaries were reviewed very shrewdly and negatively at this link:
http://www.zerohedge.com/contributed/federal-reserve-and-bank-america-initiate-coup-dump-hundreds-billions-dollars-losses-ame?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+zerohedge%2Ffeed+%28zero+hedge+-+on+a+long+enough+timeline%2C+the+survival+rate+for+everyone+drops+to+zero%29
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