<?xml version="1.0"?>
<oembed><version>1.0</version><provider_name>naked capitalism</provider_name><provider_url>https://www.nakedcapitalism.com</provider_url><author_name>Yves Smith</author_name><author_url>https://www.nakedcapitalism.com/author/yves-smith</author_url><title>The FDIC's Rosy, Theoretical, Misleading Lehman Resolution Counterfactual (or Why TBTF is Still TBTF) | naked capitalism</title><type>rich</type><width>600</width><height>338</height><html>&lt;blockquote class="wp-embedded-content" data-secret="t62UFhOJhV"&gt;&lt;a href="https://www.nakedcapitalism.com/2011/04/the-fdics-rosy-theoretical-misleading-lehman-resolution-counterfactual-or-why-tbtf-is-still-tbtf.html"&gt;The FDIC&#x2019;s Rosy, Theoretical, Misleading Lehman Resolution Counterfactual (or Why TBTF is Still TBTF)&lt;/a&gt;&lt;/blockquote&gt;&lt;iframe sandbox="allow-scripts" security="restricted" src="https://www.nakedcapitalism.com/2011/04/the-fdics-rosy-theoretical-misleading-lehman-resolution-counterfactual-or-why-tbtf-is-still-tbtf.html/embed#?secret=t62UFhOJhV" width="600" height="338" title="&#x201C;The FDIC&#x2019;s Rosy, Theoretical, Misleading Lehman Resolution Counterfactual (or Why TBTF is Still TBTF)&#x201D; &#x2014; naked capitalism" data-secret="t62UFhOJhV" frameborder="0" marginwidth="0" marginheight="0" scrolling="no" class="wp-embedded-content"&gt;&lt;/iframe&gt;&lt;script type="text/javascript"&gt;
/* &lt;![CDATA[ */
/*! This file is auto-generated */
!function(d,l){"use strict";l.querySelector&amp;&amp;d.addEventListener&amp;&amp;"undefined"!=typeof URL&amp;&amp;(d.wp=d.wp||{},d.wp.receiveEmbedMessage||(d.wp.receiveEmbedMessage=function(e){var t=e.data;if((t||t.secret||t.message||t.value)&amp;&amp;!/[^a-zA-Z0-9]/.test(t.secret)){for(var s,r,n,a=l.querySelectorAll('iframe[data-secret="'+t.secret+'"]'),o=l.querySelectorAll('blockquote[data-secret="'+t.secret+'"]'),c=new RegExp("^https?:$","i"),i=0;i&lt;o.length;i++)o[i].style.display="none";for(i=0;i&lt;a.length;i++)s=a[i],e.source===s.contentWindow&amp;&amp;(s.removeAttribute("style"),"height"===t.message?(1e3&lt;(r=parseInt(t.value,10))?r=1e3:~~r&lt;200&amp;&amp;(r=200),s.height=r):"link"===t.message&amp;&amp;(r=new URL(s.getAttribute("src")),n=new URL(t.value),c.test(n.protocol))&amp;&amp;n.host===r.host&amp;&amp;l.activeElement===s&amp;&amp;(d.top.location.href=t.value))}},d.addEventListener("message",d.wp.receiveEmbedMessage,!1),l.addEventListener("DOMContentLoaded",function(){for(var e,t,s=l.querySelectorAll("iframe.wp-embedded-content"),r=0;r&lt;s.length;r++)(t=(e=s[r]).getAttribute("data-secret"))||(t=Math.random().toString(36).substring(2,12),e.src+="#?secret="+t,e.setAttribute("data-secret",t)),e.contentWindow.postMessage({message:"ready",secret:t},"*")},!1)))}(window,document);
/* ]]&gt; */
&lt;/script&gt;
</html><description>The FDIC has released a document that purports to show how it could have successfully resolved Lehman Brothers using its new Title II resolution authority granted under Dodd Frank.  All I can say is that this is an interesting piece of creative writing. The Lehman counterfactual rests on a series of assumptions, which as I will discuss shortly, look pretty questionable. The most charitable assessment one can make comes from a famous exchange between two technologists. Trygve Reenskaug says: "In theory, practice is simple." Alexandre Boily asks: "But, is it simple to practice theory?".   But some longstanding Administration cheerleaders have jumped on the bandwagon, arguing that "pundits" have asserted "without evidence or analysis" that the resolution authority can't work. That's pretty amusing, given that Shiela Bair herself concedes, per the Financial Times, that the resolution authority will not work on a major international bank with retail and investment banking operations:</description></oembed>

<!--
Performance optimized by W3 Total Cache. Learn more: https://www.boldgrid.com/w3-total-cache/

Page Caching using memcached (REST request) 

Served from: www.nakedcapitalism.com @ 2024-04-01 00:42:26 by W3 Total Cache
-->