The Big Boys And Plan N

Here's the Yahoo Tech-Ticker guys talking to analyst Chris Whalen about Citi and BoA ending up in Plan N territory before the end of the year.

What would this mean, exactly? The government running our banks for the next decade?

No, says our guest Chris Whalen of Institutional Risk Analytics. "Nationalization" is a poor word to describe the process. "Receivership and restructuring," along the lines of what the FDIC did with WaMu, is the right way to think about it.

The biggest concern of those opposed to the RECEIVERSHIP route is that the debt markets will seize up again as debtholders realize that their capital is at risk. Chris Whalen thinks this fear is overblown.

Which is correct, because there's far more at risk than just shareholder debt and intraparty contracts. The whole thing is rotten, top to bottom. A strong plan that deals with these issues is what the financial sector wants to see and what the American people deserve to have.