Every financial expert and economist says that until the government comes up with a way to handle the bank’s “toxic assets” all the stimulus packages and bailouts are useless.
The guy’s known about for 6 months.
The guy’s known he was responsible for dealing with this for 5 months.
The guy’s had 2 months to present a plan.
And what have we heard?
maybe there is no way to handle them =)
maybe the banks just need to HTFU and fail for being stupid.
Some sort of mortgage plan was unveiled by the Obama administration back on 3/4…perhaps you missed it.
I didn’t pay close attention because I’m not in any danger of losing my home. Whatever it is, it isn’t going to fix everyone’s problems, you can be sure of that.
I saw it. It only dealt with people only slightly underwater. But the real problem is properties where banks have taken huge losses. The 3/4 plan didn’t touch these.
If the plan is to let them fail, why pump money into them.
To date there is no plan.
Maybe he’s waiting for the teleprompter to show the way!
In times of crisis, it’s always smart to rely on your own strengths! 
COming from someone out in the trenches, one of the main problems to be dealt is liquidating assets in a timely manner. If you make an offer on a short sale property, it can be 6 months before you get an answer. Maybe it is time to re-start the old RTC from the 80’s for managing and liquidating assets. There are buyers out there but with the hassle associated with bank properties, they are jumping to new construction and the tax credits that come with them
The exact losses are difficult/impossible to value, given the frozen credit markets and housing crash and rising unemployment. Stabilizing the economy is crucial, as well as stemming job losses (Rising unemployment means skyrocketing foreclosures). There is a multi-pronged effort to stabilize housing prices, reduce foreclosures, get more folks working and unfreeze credit markets. There are dangers and shortcomings with this approach. What is your brilliant solution, please let us all know!
What is your brilliant solution, please let us all know!
I wasn’t elected on November 4th because I was the smartest guy in the world with all the answers.
But I do know that Hope is not an actual plan.
What is your brilliant solution, please let us all know!
I wasn’t elected on November 4th because I was the smartest guy in the world with all the answers.
But I do know that Hope is not an actual plan.
Actually “Hope” was only one-third of the plan. The remaining two-thirds were 'Change" and Believe". Feel good about the plan yet?
Well there was a plan, to pump money in to them
it is a stupid plan though.
but the best plan is probably no plan at all
but the american voter is too stupid to stand for that
such is democracy!
If the plan is to let them fail, why pump money into them.
To date there is no plan.
Maybe he’s waiting for the teleprompter to show the way!
**Every financial expert and economist says that until the government comes up with a way to handle the bank’s “toxic assets” all the stimulus packages and bailouts are useless. **
I wonder if it is the same financial experts who thought collateralized debt obligations and wrapping/selling mortgages were also a good idea?
**And what have we heard? **
My view is the banks bought them so they should try to sell them. The problem is what to do with them, the value is too high even if you can print the money.
He is backing himself into a corner because once you start bailing out, you will soon realize it is a bottomless pit. There is no way out now other than to cut your losses and say no more money is being spent, from now on you are on your own. It would be a disaster to do that because of the wasted billions but 6 months from now we might be wishing the losses were only 1 trillion.
Every financial expert and economist says that until the government comes up with a way to handle the bank’s “toxic assets” all the stimulus packages and bailouts are useless.
The guy’s known about for 6 months.
The guy’s known he was responsible for dealing with this for 5 months.
The guy’s had 2 months to present a plan.
And what have we heard?
Isn’t the real problem that none of the options are very attractive? Didn’t Paulson articlulate all the semi-viable options a while ago and now it is just a question of deciding which unpalatable option to choose? Thre reality is that things are messed up and they are likely to be that may for a long time. No amount of government intervention is going to help solve the problem cleanly when you are trying to clean up the mess after it has already happened.
It’s in work, and I think they said Geithner will be out tuesday with the new super-plan. Despite unpopularity, I imagine Geithner will stay around long enough to lay out, explain, and stump for this new massive spending, before he decides to leave to “spend more time with his family”. There’s also this:
"The Federal Open Market Committee (FOMC) yesterday informed the public that it will expand its dominating position in the MBS market, throwing an additional $750 billion there. The buying spree does not end there. Having arrived at zero interest rate policy 3 months earlier the Fed now hopes to control interest rates by monetizing US Treasuries equalling $300 billion. Stirring still more Bourbon in the punch bowl the Fed will also up its portfolio of agency debt by another $100 billion.
Markets rallied on the news with Treasuries shedding up to 51 basis points. Gold outshone everything and spurted more than $50 on the FOMC’s news that will ultimately lead to higher inflation rates despite the FOMC statement that said,
“In light of increasing economic slack here and abroad, the Committee expects that inflation will remain subdued.”
http://prudentinvestor.blogspot.com/2009/03/monetizing-debt-fed-will-buy-everything.html
The losses would seem easy to calculate. A little mass appraisal work and some statistical modeling could do it.
I can tell you the tax credit for purchasing new homes is working. In CA we have a state and fed tax credit which is really moving new homes. This will help bank balance sheets by burning through inventory and hopefully stabilize pricing.