Scarred by the failure and near-failure of so many banks in 2008, the Federal Reserve has reportedly asked Bank of America to have an emergency plan for what happens if its stock continues to fall. (It’s down nearly 35 percent in the last three months.) The Fed was reportedly so concerned this summer that it asked Bank of America to draft what amounted to a Worst-Case Scenario Survival Handbook, in case it needed a quick hit of cash. Daily Intel has obtained the draft copies.*
• Kidnap former Countrywide CEO Angelo Mozilo, because he started this mess. Tie him to a dunk tank and charge $1,000 a throw for the chance to sink him.
• Bring back Ken Lewis as CEO to restore investor confidence by reminding everybody about how bad things used to be.
• Call the Fed’s bluff and just liquidate all of its mortgage assets. You really want us to have cash so bad? Fine, it’ll only cost you the economy.
• Bribe an actual oracle to tell Warren Buffett to give us more money, this time with less onerous terms.
Fine ideas, all. But the final decision was to offer something called “tracking stock” in Bank of America’s Merrill Lynch, which would allow people to own a piece of the company, but not be able to vote on what the company does like a traditional shareholder. Should’ve gone with their first instincts.
*Not really, of course. You know us better than that.
Fresh Scrutiny of BofA [WSJ]