A very troubling bit of information hiding in a grammatically flawed section of the press release confirms fears that the TLGP surcharges will be merely a way to restore the DIF fund which at this moment could be as low a $0 and which information, if widely known, would not be received well by U.S. depositors once they realize that none of their deposits have even an implicit token financial backing anymore. Instead money that by statutory requirement is supposed to be there for the sole backing of depositors, will be eroded as it is used as a "slush fund", to provide additional under the radar cash to Bank Holding Companies (read all financials).
Surcharges will be will be [sic] in addition to current fees for guaranteed debt and deposited into the Deposit Insurance Fund (DIF) instead of being set aside to cover potential TLG program losses.
"The surcharges recognize that a relatively small portion of the industry is actively using the debt guarantee [this is patently false], but all insured depository institutions ultimately bear the risks associated with this program," noted Chairman Bair. "Putting the surcharges in the DIF will bolster the reserves that support our regular insurance program. Surcharge revenues collected in the second quarter, combined with Congressional action to increase our borrowing authority, should enable the FDIC to meaningfully reduce the 20 basis point special assessment proposed by the board on February 27th." noted Chairman Bair.
This is merely yet another datapoint of all the dirt that is being swept under the carpet as Obama hits the talk show circuit to cheer lead the 12% bear market rally and convince even more people to throw away their money into a market which with every passing day is becoming less viable.