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Toxic Asset Plan Foresees Big Subsidies for Investors

Posted By admin On March 21, 2009 @ 3:48 am In Money Watch | Comments Disabled

EDMUND L. ANDREWS, ERIC DASH and GRAHAM BOWLEY
NY Times [1]
Saturday, March 21, 2009

The Treasury Department is expected to unveil early next week its long-delayed plan to buy as much as $1 trillion in troubled mortgages and related assets from financial institutions, according to people close to the talks.

The plan is likely to offer generous subsidies, in the form of low-interest loans, to coax investors to form partnerships with the government to buy toxic assets from banks.

To help protect taxpayers, who would pay for the bulk of the purchases, the plan calls for auctioning assets to the highest bidders.

Toxic Asset Plan Foresees Big Subsidies for Investors obamadecept 340x169 [2]

The uproar over the American International Group’s bonuses has not stopped the Obama administration from plowing ahead. The plan is not expected to impose restrictions on the executive pay of private investors or fund managers who participate.

The three-pronged approach is perhaps the most central component of President Obama’s plan to rescue the nation’s banking system from the money-losing assets weighing down bank balance sheets, crippling their ability to make new loans and deepening the recession.

Industry analysts estimate that the nation’s banks are holding at least $2 trillion in troubled assets, mostly residential and commercial mortgages.

Full article here [1]


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URLs in this post:

[1] NY Times : http://www.nytimes.com/2009/03/21/business/21bank.html?_r=1&WRH

[2] Image: http://www.prisonplanet.tv/subscribe.html

[3] Toxic Asset Plan Will Leave The Same Amount Of Toxic Assets In The System, But With the Taxpayers Now Liable For Most Of The Losses: http://www.prisonplanet.com/toxic-asset-plan-will-leave-the-same-amount-of-toxic-assets-in-the-system-but-with-the-taxpayers-now-liable-for-most-of-the-losses.html

[4] Treasury Presses Ahead With Plan For Toxic Assets: http://www.prisonplanet.com/treasury-presses-ahead-with-plan-for-toxic-assets.html

[5] US unveils public-private plan for toxic assets: http://www.prisonplanet.com/us-unveils-public-private-plan-for-toxic-assets.html

[6] What Happens Now to Plan to Buy Toxic Bank Debt?: http://www.prisonplanet.com/what-happens-now-to-plan-to-buy-toxic-bank-debt.html

[7] European Banks Frantically Trying To Dump $7 Trillion Of Crap Assets — But No One Will Buy Them: http://www.prisonplanet.com/european-banks-frantically-trying-to-dump-7-trillion-of-crap-assets-but-no-one-will-buy-them.html

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