On its face, it's a shocking headline -- but it's not quite what it seems. The Federal Deposit Insurance Corporation announced today that it would begin selling bonds backed by residential mortgages. If these sound a little too much like the kinds of financial instruments that cratered the economy in 2008, rest assured that these securities are quite different. For one, the $500 million in underlying mortgages come from 250 banks that the FDIC has shut down since 2008. More importantly, 85 percent of the bonds will be guaranteed by the FDIC; it may not even sell notes based on the mortgages most likely to default. FDIC chairman Sheila Bair and Federal Reserve chairman Ben Bernanke, pictured above, discussed U.S. monetary policy yesterday.
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