More Fannie and Freddie fallout. The Treasury's bailout is labeled a "conservatorship," but it's treated as a bankruptcy in the market for credit protection insurance, or credit default swaps (CDSs). One London banker estimates $200 billion to $500 billion of Fannie/Freddie CDSs are outstanding. That makes the Fannie/Freddie debacle many times larger than the next largest CDS default, which was auto-parts maker Delphi, which had $25 billion of CDSs outstanding in 2005. At a loss rate of 10%, insurers and banks could be on the hook for as much as $50 billion of Fannie/Freddie CDS losses. AIG and Washington Mutual's upcoming shake out come to mind.