Andrew Ross Sorkin
has been digging around in the FDIC’s charter, and has discovered that
it is barred from incurring any obligation greater than $30 billion.
Which is a bit inconvenient, seeing as how it’s about to guarantee as
much as $1 trillion as part of the PPIP bank bailout program.
The sneaky way that the FDIC is getting around this obstacle is to
say that the value of those obligations is actually zero, since zero is
the “expected cost to the corporation”.