Taxpayers to bail out banks
http://news.yahoo.com/s/ft/20071212/bs_ft/fto121220070025397966;_ylt=AhDFjg4hn7TsXlPoT5uII7Os0NUE
And there you have it.
The Fed will announce a plan today to "provide funds directly to a much larger group of banks than the limited number of primary dealers who participate in open market operations, against a wide range of collateral"
Guess what collateral will be used? Dud home loans. So, in effect, the Fed will be buying these dud loans because far too many of these larger group of banks will not survive.
The objective of the Fed is to keep the banks alive and lending money. The problem is that Cheap lending is what got us here in the first place. More importantly, consumer appetite for debt is dropping.
The Fed is trying to hand the alcoholic adrink, without realizing that the guy is already passed out.
And there you have it.
The Fed will announce a plan today to "provide funds directly to a much larger group of banks than the limited number of primary dealers who participate in open market operations, against a wide range of collateral"
Guess what collateral will be used? Dud home loans. So, in effect, the Fed will be buying these dud loans because far too many of these larger group of banks will not survive.
The objective of the Fed is to keep the banks alive and lending money. The problem is that Cheap lending is what got us here in the first place. More importantly, consumer appetite for debt is dropping.
The Fed is trying to hand the alcoholic adrink, without realizing that the guy is already passed out.
posted by Andrew at
5:03 AM
0 Comments:
Post a Comment
Subscribe to Post Comments [Atom]
<< Home