September 10, 2008 (LPAC)--With American voters waking up to the fact that trillions of their tax money has just been pledged by Treasury Secretary Hank Paulson to bail out bankrupt banks' securities in the financial crash, more and bigger banks are getting the runs. More big bailouts are being rumored in the financial press.

• A subsidiary of Warren Buffett's Berkshire Hathaway, Kansas Bankers Surety Corp., has terminated its "excess deposit insurance" plan by which it insured bank deposits above $100,000, particularly for smaller community and regional banks. The reason, a Paris banking source said today, is that Buffett fears 1,500 U.S. banks failing in the near future. The Wall Street Journal made a similar report of Buffett's fears as the cause.
• A "tip of the iceberg" research report immediately identified 14 U.S. regional banks, at least 5% of whose core capital was now-worthless stock of Fannie Mae and Freddie Mac; since the report only identified one-thirtieth of that stock outstanding, the actual number of such banks is in the hundreds. They now have to raise more capital in a credit market which ain't buying, and a large number will have to be merged or taken over.
• Lehman (or, Lemon) Brothers, whose CEO Richard Fuld is closely advised by fascist Felix Rohatyn, is "into endgame" reported the Wall Street Journal after it reported a $3.9 billion second-quarter loss and started setting up a separate unit to try to auction off $30 billion in commercial mortgage-backed securities. The amount reminds a lot of Bear Stearns, and the toxic crap is like what Merrill Lynch recently sold for 20 cents on the dollar--after having to loan the buyer the money. So, the press are full of reports of another Federal Reserve MBS bailout coming. Rumors say the likely "receiving bank" for the remnants of Lemon Brothers is Morgan Stanley. And that, commented Lyndon LaRouche, is "like the sinking Titanic buying another anchor!"
• Washington Mutual, the country's biggest S&L with over $250 billion in deposits and a totally toxic book of mortgage "assets," was placed on probation by the Office of Thrift Supervision, with the cost of derivatives to insure its bonds zooming up to an all-time record $4 million upfront plus $500,000/year to insure $10 million. It's unlikely to be able to raise more capital, or to find another bank willing to buy.