FED CAN'T BANK ON WACHOVIA MERGER

`` At a recent conference, Steel told analysts that he's been on the job for a few months and he still believes the total losses on the $122 billion portfolio will only be 12 percent - at current market value that's $14.6 billion. Jason Talbert, an analyst with the New York hedge fund, Wesley Capital, told Steel, according to Lehman research, that he believes Wachovia is facing losses closer to 20 percent - or $10 billion more then Steel. Talbert's not alone. ''