[quote=sdduuuude][quote=davelj]Your equations above are meaningless because you don’t know what reserves or charge-offs have already been put up against the NPAs.[/quote]

Actually, I did. The quote continues. Here is the part I did not include ….

[quote=Meredith]There’s huge growth in non-performing assets. These are numbers, apples-to-apples, on the four big banks. The issue is when does that stuff that’s not paying come to market, and when do banks recognize the chargeoffs? I think you’re going to see more of that in the second quarter and the third quarter. Does the supply move in the second quarter and then you report it in the third quarter? The timing may be weighted more to the third quarter. I just don’t know.[/quote]

So, if Meredith is to be trusted, it’s pretty clear that those NPAs have not yet been charged off.[/quote]

As I’ve explained here before… charge-offs don’t happen all at once. A large portion of a loan’s ultimate charge-off (when there’s a loss) is charged off BEFORE the collateral is sold. Reserves and charge-offs take place as an asset moves from performing status to non-performing status to doubtful status to sale. I’m NOT saying that Meredith Whitney is wrong here… I’m just saying that YOU don’t have enough information or context to know the difference. My point here really has nothing to do with Meredith Whitney’s prediction, but rather your willingness to comment on her prediction when you don’t have enough information or expertise to do so intelligently.