The following post appeared earlier Tuesday on RealMoney. Sign up for a free trial of RealMoney, and enjoy incisive commentary all day, every day.

What's at stake with nationalization? Why do I oppose it so much? Why do I feel that its proponents are glib and over their heads and have done no homework and do not have a stitch of rigor? Maybe because I think that nothing is impossible for those who don't have to do it themselves.I have said again and again that as much as you may hate the bankers who got us here, it is well beyond the ken of this government to fix it. I have said that the analogies to the Swedish "success" of nationalization are chimerical, because the Swedish banking issues were small and manageable. I have said that you simply can't compare the two.

Nobody's listening, They are listening to academics who have never traded a stock, a currency, a future or a complex derivative. They are listening to people who could never manage a profit and loss statement. Never . They will sink us to the Stone Age if given the chance. But maybe that's not even getting through to people.

So how about this? How about considering what the government will have to do to unwind a large bank that has problems, like Bank of America ( BAC). Take a look at the real BofA based on December consolidated financial statements. Ask yourself, can the team run by Tim Geithner, a team that can't even staff itself, be able to run this bank with these stats? This is what you would have to run if you owned BofA based just on the off-balance-sheet items from bank at the end of the year. That's right, forget about all of the bad loans, both residential and commercial, forget about all of the difficult servicer issues involving Countrywide and just consider this horror show: :
  • 1.3 trillion in binding unfunded loan commitments.
  • $80 billion in letters of credit.
  • $1 trillion "matched" book of credit default swaps.
  • $1.4 trillion notional swap book.
  • $60 billion in liquidity commitments to conduits.
  • $26 billion in residential loan guarantees related to loans sold but still serviced.
  • I don't have the numbers handy on variable interest SPVs but they're not insignificant.

As one of my friends, in fact my most sophisticated friend in banking who has worked as a primary regulator of financial institutions, including with the Resolution Trust Corp., or RTC, says, "This would be an unmitigated disaster."

Oh, and by the way, this consolidated balance sheet doesn't have the latest problems that have surfaced at Merrill Lynch with end-of-the-year bonuses and problem collateralized debt obligations. Sure, let the invisible Timmy Geithner fix those in his spare time, while he solves the auto industry conundrum.

I am sure that's not enough to stop the advocates of nationalization, though. Their next argument is "Forget Sweden, we did it before in the United States," with the RTC that worked on the savings and loan crisis in the late 1980s. They cite it as the classic example of "successful nationalization." But let's consider that example.

At its peak the RTC had $160 billion in assets from failed institutions. Those assets were in 675 failed savings and loans. The average size of a failed institution was $237 million. The initial funding for the RTC in 1991 was $30 billion. The RTC was in operation for nine years from 1989 through 1997.

Advocates of nationalization speak cavalierly about closing one or all three of the following banks: Bank of America, Citigroup ( C) or Wells Fargo ( WFC) and giving it to the Federal Deposit Insurance Corp. to handle.

The largest of these, Bank of America, has about $2.4 trillion in assets. That one institution is about 15 times the size of the entire RTC caseload at its peak. It is about 50 times the size of the average RTC institution.

If it cost $30 billion to start the RTC, what would it cost just to start nationalizing Bank of America in today's dollars?

Now let's consider some statistics about FDIC staffing. At the peak of the RTC, in 1992, the agency had 15,000 people working for it. Now staffing at year-end 2007 stood at 4,600. They have added some examiners but not enough to cover anywhere near the problem of one or two big banks and the problems are spread all over the country.

In 1992 the FDIC closed 120 banks with $45 billion in assets.

What would be the staffing needs to nationalize Bank of America, Citi, and Wells as some advocates suggest is necessary? Their total assets are about $5 trillion.

If it took the RTC nine years to deal with a caseload that at its peak was $160 billion in assets, how long will it take to deal with say $5 trillion. Do we have that kind of time?

We haven't even mentioned that the "nationalizers" would like to close many more banks than this and give them to the RTC. The market has judged that most of the banks, all those under $5, are worth giving over to the FDIC for nationalization. Oh, and by the way, the RTC assets were relatively straightforward, compared with the balance and off-balance sheets of the big banks today.

It is just an impossible mission to nationalize these large banks. We must forbear, we must give the best of them capital and certify their net worth, and then we can have them give the money back when things are better. We can ring-fence the strongest institutions with a stress test and slowly work through the others so as not to dump assets all at once at a crucial and critical time. These assets will get better if we let the market have some breathing room and we allow people to refinance with government mortgages at 4% -- everyone --and allow principal cutting that gives the banks upside if the properties are eventually sold. We simply can't handle these assets now as a nation. We are ill-equipped. We will fail. A great depression will ensue.

On Monday, I advanced a plan to make it so we get through this. It was not received by anyone in power as an obstacle toward nationalization. Perhaps these sobering facts will change that debate. They better, or all of this talk about Dow 6000 will seem incredibly wishful and optimistic. We must take the debate out of the hands of the dreamer academics, and into the hands of practical business people, no matter how much we despise them for getting us into this fix in the first place. They really are our only hope.

At the time of publication, Cramer was long Wells Fargo.

Jim Cramer is co-founder and chairman of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. Outside contributing columnists for TheStreet.com and RealMoney.com, including Cramer, may, from time to time, write about stocks in which they have a position. In such cases, appropriate disclosure is made. To see his personal portfolio and find out what trades Cramer will make before he makes them, sign up for Action Alerts PLUS. Watch Cramer on "Mad Money" weeknights on CNBC. To order Cramer's newest book -- "Jim Cramer's Stay Mad for Life: Get Rich, Stay Rich (Make Your Kids Even Richer)," click here. Click here to order "Mad Money: Watch TV, Get Rich," click here to order "Real Money: Sane Investing in an Insane World," click here to get "You Got Screwed!" and click here for Cramer's autobiography, "Confessions of a Street Addict." While he cannot provide personalized investment advice or recommendations, he appreciates your feedback and invites you to send comments by clicking here.

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