US losses may reach $3.6 trillion

U.S. financial losses from the credit crisis may reach $3.6 trillion, suggesting the banking system is “effectively insolvent,” said New York University Professor Nouriel Roubini, who predicted last year’s economic crisis.

“I’ve found that credit losses could peak at a level of $3.6 trillion for U.S. institutions, half of them by banks and broker dealers,” Roubini said at a conference in Dubai today. “If that’s true, it means the U.S. banking system is effectively insolvent because it starts with a capital of $1.4 trillion. This is a systemic banking crisis.”

Losses and writedowns at financial companies worldwide have risen to more than $1 trillion since the U.S. subprime mortgage market collapsed in 2007, according to data compiled by Bloomberg.

http://www.bloomberg.com/apps/news?pid=20601087&sid=aS0yBnMR3USk&refer=home

Bailout of banks, Citigroup

Citigroup has received two lifelines from the U.S. Treasury Department's Troubled Asset Relief Program, getting $25 billion in October 08 and $20 billion in November 08.

The second infusion involved an agreement by the government to share in some losses, in exchange for preferred stock and warrants.

http://www.reuters.com/article/
newsOne/idUSN1234412520090114

Is this a welfare for the richest? From the richest.