Thursday, November 13, 2008

GE Gets FDIC Gurantee On $139 Billion of Its Debt

The FDIC guarantees non-bank debt? $139 billon worth.

Keep in mind, GE last month started using a new Federal Reserve program designed to revive demand for commercial paper amid the global crisis.

Where does it stop?

GE Capital is not a bank. The technicality that is allowing the FDIC to offer the gurantee is do to the fact that GE’s GE Capital subsidiary also owns a federal savings bank and an industrial loan company, both of which already qualify. But the debt guranteed has little if nothing to do with the banks.

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