I agree, but the primary difference in the bailouts is that the Treasury and Fed think they will need china, Russia and Mexico etc to raise cash and buy new US debt so they did not want leave them in the wind and additionally the Treasury and Fed do not want to advertise that they will supply funds or guarantees to banks to whom they have already provided guarantees through their myriad of new facilities. I am quite sure that any deal even a LEH bankruptcy will include financial gymnastics from the FED...but they don't want AIG, GE, C, JPM, or any of the banks out there thinking they can win a public fight for the Fed to absorb the majority of the risk for a deal.

As it was for JPM and Bear - JPM collected 4 billion in premiums on CDS that disappeared when they absorbed Bear. Works like this. They issued CDS insurance against Bear debt and but when they absorbed the debt and it was backstopped by the fed...the counter-party disappeared...and the insurance ceased to exist...what do you think happened to the premiums?

Additionally, Bear held a large amount of derivative to which JPM was a counter-party...the synergy of eliminating the need for JPM to settle up on those deals since for example if I own 100 shares of GE and buy another company that is short 100 shares of GE - its now implied that i am holding no risk...(other than spread risk potentially). This situation grants me the full premiums on the deal instantly. Bear was necessary for JPM not an option and it was tremendously profitable. JPM made 8 billion on the deal immediately and cleaned up some of their own books at the same time. LEH may offer some similar opportunities...but this thing is different since LEH is already backstopped by the FED and nobody still wants to touch it.

Central banks were more worried with FNM and FRE than LEH but they are now shaking in their boots related to the emerging CDS crisis which LEH or FNM/FRE or WM or WB or GM or F could trigger. LEH is a symptom for them - they hope we can hide the symptom quickly this weekend.

LEH is not as big a player in CDS as many other IB's. JPM is the biggest player and has 92 trillion on exposure to derivatives risks. In fact JPM holds 1 trillion worth of hedgefund bets against GM debt through their CDS insurance and the nominal amount of GM debt they are protecting is 1 billion. Talk about naked shorting!

The last time a CDS triggered under similar situations was with Delphi. Delphi filed bankruptcy and its debt plunged...when people tried to close out the CDS insurance...JPM was on the hook and had to purchase debt to close the transactions...and triggered a move from the single digits to 90+ cents or so on the dollar for defaulted debt! This is the problem...

AIG can not survive nor can anyone else who was taken in by default insurance and  agreed to insure more than the nominal value of the debt outstanding. The ONLY words we will be hearing in the not to distant future are going to be related to CDS - which by the way makes MBS, Commercal paper and our other assorted crises look small by comparison since this was the playing field for over-leveraged institutions, SIV's, and hedgfunds to play with 100 to 1 leverage in some cases more looking for their 70% yields and big bonuses...i think the biggest i've seen is 200 to 1. LEH was not big here - but guess who is: GE, AIG, C, JPM, Barclays etc...