Is Bank of America, one of the two or three largest banks in the country, wobbling? By all accounts, we may have another too big to fail institution that needs bailing out by the federal government, lest it drag the banking system and the Western world down with it.
The bank is facing cash shortfalls of at least $50 billion related to mortgage lending disasters of recent years. The bank has petitioned regulators to give it until 2019 to straighten itself and its balance sheet out, so that it might come into compliance with new capital requirements rules. The bank is now said to be as much as $100 or $200 billion in the hole.
Bank of America's stock has fallen by 50% this year. Fresh sources of capital are drying up. The bank may have to be temporarily nationalized to survive. It took $50 billion in federal TARP loans to get Bank of America through the Lehman Brothers--AIG collapse. This looks worse.
A bad wobble indeed.
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