The U.S government’s odd brand of non-nationalization remains on the shelf, with more tens of billions of dollars flowing into Citigroup and AIG. The assistance in the form of intricate preferred and common Citi share purchases could wind up giving the feds 36 percent of the wobbling giant, in exchange for no board seats but apparently tremendous influence on board makeup. AIG is repackaging its various pieces for sale in exchange for another $30-billion injection, bringing taxpayer funding to around $180 billion. The Federal Reserve ostensibly owns just under 80 percent of the too-big-to-fail insurer but doesn’t sit on the board.

Nationalization is still opposed by many economists and financial market participants, while the White House has been vociferous in its devotion to private sector solutions. At some point soon, however, Professors Geithner, Bernanke, and the rest of the faculty will review the results of the stress tests now being taken by U.S. institutions.

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