More leaks - Toxic Asset plan could be announced by Geithner on Monday

[cjppjc]

Re: More leaks - Toxic Asset plan could be announced by Geithner on Monday

This $84 figure is most likely too high. What happens when the FDIC forces some of these banks to take lower offers than they like. Mark to market is now back on, because we have a market to mark to.
Balance sheets get wacked again. Let me see if I've got it right. Force banks to take low offers. Put the taxpayer on the hook for losses. Is this a real market?


Btw: I'm sure there will be NO collusion between the bidders.

[godraz]

Re: More leaks - Toxic Asset plan could be announced by Geithner on Monday

Today we have the confirmation it's a fraud perpetrated by the government on the behalf of the banksters. We got fresh details from from TurboTax Timmy's slush fund (aka Treasury). Lost in the bundle of lies there is a small example:
http://treasury.gov/press/releases/tg65.htm

Quote:
Sample Investment Under the Legacy Loans Program
Step 1: If a bank has a pool of residential mortgages with $100 face value that it is seeking to divest, the bank would approach the FDIC.
Step 2: The FDIC would determine, according to the above process, that they would be willing to leverage the pool at a 6-to-1 debt-to-equity ratio.
Step 3: The pool would then be auctioned by the FDIC, with several private sector bidders submitting bids. The highest bid from the private sector – in this example, $84 – would be the winner and would form a Public-Private Investment Fund to purchase the pool of mortgages.
Step 4: Of this $84 purchase price, the FDIC would provide guarantees for $72 of financing, leaving $12 of equity.
Step 5: The Treasury would then provide 50% of the equity funding required on a side-by-side basis with the investor. In this example, Treasury would invest approximately $6, with the private investor contributing $6.
Step 6: The private investor would then manage the servicing of the asset pool and the timing of its disposition on an ongoing basis – using asset managers approved and subject to oversight by the FDIC.

Gee! Why didn't they allow FDIC to write directly 0% premium CDS' on all this bad debt. This new technology would result just in very complicated balance sheets (Why was Ken Lay arrested? Because he was ahead of his time ...)

Ok, I'm stupid, but doesn't this FDIC "guarantee" amount to actual money being paid to the banks for the cost of the sale; meaning the FDIC is giving out a very large percentage of their funds -- which are after all insuring our regular bank deposits -- so now there is a huge hole in their book?

:eek:

At this rate my mattress is looking safer than any FDIC depositor insurance guarantee -- which up until today was one of the better run govt. institutions.

[ax]

Re: More leaks - Toxic Asset plan could be announced by Geithner on Monday

More of the same from The Nation: Obama's New Monopoly Set

http://www.thenation.com/doc/2009040...t?rel=nofollow

[FRED]

Re: More leaks - Toxic Asset plan could be announced by Geithner on Monday

More of the same from The Nation: Obama's New Monopoly Set

http://www.thenation.com/doc/2009040...t?rel=nofollow

Or try our version:

OLIGOPOLY: Fun Family Board Game for the post FIRE Economy Depression

Our modern version of MONOPOLY® will be a hit over the next few years when families once again as in the 1930s find themselves with too much extra time on their hands and looking for ways not to strangle each other, and learn how the economy really works in the bargain

Parker Bros. introduced the family board game MONOPOLY® in 1935 during the depths of The Great Depression. The original game was reportedly invented in 1904 by a Quaker woman named Elizabeth J. Magie Phillips who hoped to use it as a teaching tool to explain the single tax theory of Henry George, specifically to illustrate the negative aspects the concentrating of land ownership by monopolies. She called her game The Landlord's Game.

As a MONOPOLY® game player you get to collect and handle money, even if it’s only money printed on brightly colored paper one grade above bathroom tissue. It gave millions a chance to handle fake money at a time when no one had any real money. Thus the broad appeal -- over 250 million sets of the game have been sold worldwide.

One of our members asked (Hat tip to iTuliper don), if the game were to come out during the now developing depression following the collapse of the FIRE Economy versus in the 1930s, how might the game look today? Here we bring the old Depression era favorite up to date as the iTulip game: OLIGOPOLY. more...

[bill]

Re: More leaks - Toxic Asset plan could be announced by Geithner on Monday

Anyone have a copy of his 61 page bill sent to congress?
http://news.yahoo.com/s/ap/20090326/...ial_regulation

The administration, pushing Congress to act quickly on its reform agenda, sent Congress a 61-page bill dealing with the expanded powers to seize control of nonbank institutions late Wednesday. The House Financial Services Committee, chaired by Rep. Barney Frank, D-Mass., has indicated it could move on the measure as early as next week.
However, it was unclear how fast the rest of the financial reform agenda might move through Congress. Geithner was providing only a broad outline of the other proposals, with many thorny details remaining to be worked out.
Administration officials promised that the remaining issues would be hammered out in consultation with Congress with the goal of getting legislation approved as quickly as possible.