Bad Banks, Insurance Wraps and Other Fanciful Notions

``No, just as we believe that the losses at Fannie/Freddie must eventually involve a haircut for non-collateralized debt holders, the situation at the larger money centers such as C and BAC demands the treatment described by Eugene Fama at University of Chicago. While the customers and counterparties of the subsidiary banks of these groups will not be affected, we cannot see how the creditors of the parent holding companies will avoid a haircut - at least so long as Fair-Value Accounting is the law of the land. Just remember Washington Mutual.''