"Dexia May Be Left as Bad Bank as Governments Shun Injections" (Bloomberg / BusinessWeek article) http://www.bloomberg.com/news/2011-...-governments-avoid-injecting-new-capital.html Quote: "Under the option most favored by the French, the two governments would guarantee Dexia's borrowings before splitting up the lender, said the people, who declined to be identified because the talks are private. Belgium may then assume Dexia's assets in that country, while France's state-owned La Banque Postale and Caisse des Depots et Consignations would buy Dexia's French municipal-lending unit, leaving Dexia as the âbad bank,â the people said. "That would avoid an immediate recapitalization of the Belgian municipal lender, which would then sell its legacy assets over time, the people said. " ********* OK, maybe I'm just a cynical observer, but this sounds like the July 2008 "bailout" of FRE and FNM, when the liabilities were guaranteed, but there was no capital injection. Then as we all know, the entities were put into conservatorship (and were forced to issue senior preferred stock to US govt) in September 2008. This proposed "bailout" for Dexia doesn't address the obvious - someone (shareholders or taxpayers) will be forced to take the losses. Am I missing something? Or just making too much sense?