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Thursday, October 02, 2008

BofA: Fed May Lose $6 Billion on Bear Assets

by Calculated Risk on 10/02/2008 12:15:00 PM

From Bloomberg: Fed May Lose Out on Bear Assets, Bank of America Says

The Fed will announce its quarterly estimate of the fair value of Maiden Lane LLC's $30 billion of holdings that JPMorgan Chase & Co. considered too risky when it acquired Bear Stearns in March, Bank of America analysts Jeffrey Rosenberg and Hans Mikkelsen wrote in a client note. The central bank valued the assets at $29 billion as of June 30, according to the report.

``With the worsening in mortgage markets since last quarter, we estimate a range of $2 billion to $6 billion of unrealized losses,'' the New York-based analysts wrote.
Just sell them to Paulson ... problem solved.