Jr Deputy Accountant (aka Adrienne Gonzalez) wrote a short post Friday for the Going Concern blog that raises an auditor's red flag about the "going concern" viability of one of bedrocks of the nation's financial stability. No, not Warren Buffet, the FDIC.
With her tongue jammed only halfway into her cheek, Adrienne gives her usual wonderfully gonzoesque riff on the fiscal woes facing the FDIC with the steamroller of Colonial Bank hurtling down the road to ruin.
WARNING: SALTY LANGUAGE AHEAD
We are not in the business of auditing the financial statements of the FDIC, even if they provided such information. Frankly, if they did, we really aren’t equipped to analyze said statements. Be that as it may, you don’t need to be an expert to see that the FDIC is in a whole shit ton of trouble (yes, that is our qualified opinion).
Remember Colonial Bank? Surely Sheila Bair has been up late since the news broke on Monday that they’d cooked their books, or something about TARP fraud (though the bank never received TARP funds after that TBW deal for $300 million fell through Friday). Maybe it was undercapitalization? Who keeps track of these things?
[...]
Colonial has about $25.5 billion in assets, while the FDIC has about $13 billion remaining in the fund. According to Sheila’s math, new FDIC fees levied against Too Big to Fail will net the fund about $27 billion this year. To put this into perspective, the FDIC lost $33.5 billion in 2008 to cover 25 bank failures. Add it up, as we’ve had 69 bank failures in 2009 to date. Carry the 1 and I believe we arrive at the following figure: the FDIC is screwed.
In the interest of full disclosure, Adrienne informs the reader that she "has long since diversified her 'investments' in the First National Bank of Her Mattress, thankyouverymuch."
Great stuff. As a side note, I can't wait to see how many e-mails she receives from readers who take her absolutely, positively seriously.
