BUSINESS
03/01/2009 05:12 am ET Updated May 25, 2011

Cost Of Shoring Up Banks May Reach $4 Trillion

The cost of restoring confidence in U.S. financial firms may reach $4 trillion if President Barack Obama moves ahead with a "bad bank" that buys up souring assets.

The figure far exceeds even the most pessimistic estimates of how great the loan losses might be because there is so much uncertainty about default rates, which means the government may need to take on a bigger chunk of bank debt to ease concerns.

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