FDIC Chairman Sheila Bair has been under attack recently in various quarters of the crisis blogosphere in a campaign that culminated this morning in a critical New York Times column today by Andrew Ross "Let Those AIG 'Brainiacs' Keep Their Bonuses" Sorkin, who takes issue with her agency's agreement to guarantee all the non-recourse loans Treasury's toxic asset buyout plan is promising private investors to leverage their bets.

So how much does the F.D.I.C. think it might lose?

"We project no losses," Sheila Bair, the chairwoman, told me in an interview. Zero? Really? "Our accountants have signed off on no net losses," she said. (Well, that's one way to stay under the borrowing cap.)

By this logic, though, the F.D.I.C. appears to have determined it can lend an unlimited amount of money to anyone so long as it believes, at least at the moment, that it won't lose any money.

Here's the F.D.I.C.'s explanation: It says it plans to carefully vet every loan that gets made and it will receive fees and collateral in exchange. And then there's the safety net: If it loses money from insuring those investments, it will assess the financial industry a fee to pay the agency back.

So what's the problem here? It's not as if Bair is afraid to project a loss for her agency. The biggest concern about the plan is that it will enrich Wall Street at the expense of real prices -- especially if banks use the funds to bid up each other's bad loans as envisioned by this blogger we read on Felix Salmon's blog:

Before we go there, what will happen with these banks when they can bid on each other's assets? Let's do a thought exercise. Let's say you are a bidder for Bank A. You know your banking asset is worth $50, and you also know the asset Bank B has is worth $50. You call your buddy up, the trader at B, and make a deal. Happens all the time. You go to bid, and you bid $80 for B's asset. Then you wait. If B doesn't come through, you are screwed out a lot of money. And hey, isn't this wrong? Well, you are pretty sure one of those Rubin-protégé government whiz-kids has given someone who knows someone you know a wink-wink about this. You take a drink, steady the nerves. Then, the bid comes back for your asset - $80 from B. You have each bid up each others assets and traded them. And now the government is screwed.

But if the actions of the Rubin protégé government whiz kids -- and we suspect that may be a veiled reference to a certain former New York Fed President -- are being vetted by a regulator with a well-documented history of clashing with Geithner and Citigroup, isn't that the best we can hope for?

(ed. note: This post originally misattributed certain criticisms of Sheila Bair and JP Morgan CEO Jamie Dimon to John Hempton. While Mr. Hempton has been critical of Ms. Bair, the criticisms mentioned here were not his. We regret the error and apologize for the mischaracterization.)