U.S. Bank Bailout to Rely in Part on Private Money

New York Times ^ | 2-8-09 | FLOYD NORRIS

[Justaham]

Wall Street helped produce the global financial and economic crisis. Now, as the Obama administration prepares to unveil a revised bailout plan for the banking system, policy makers hope Wall Street can be part of the solution. Administration officials said the plan, to be announced Tuesday, was likely to depend in part on the willingness of private investors other than banks — like hedge funds, private equity funds and perhaps even insurance companies — to buy the contaminating assets that wiped out the capital of many banks.

[o_zarkman44]

What a stupid idea.......investing in failure with perfectly good money.

[NVDave]

Only way I’d be investing in some of these wrecks is if I get to enforce strict civil liability upon them PERSONALLY for any mis-statement on the financial statements, or misleading predictions/projections given to investors.

I want a contractual piercing of the corporate wall, so that they have a direct, personal stake in making sure that they do their job.

[javachip]

Since there’s nothing stopping private investors from buying “the contaminating assets that wiped out the capital of many banks” right now, the government is either planning on shoveling tax dollars to Wall St. hedge funds or relying on pixie dust and magic unicorns to bring in private capital.