Bank Bailout Plan Revamped

online.wsj.com via Drudge ^ | 2/9/09 | Solomon and Paletta

[nicolezmomma]

Treasury Secretary Timothy Geithner is expected to announce that the government will become a partner with the private sector to purchase banks' troubled assets, according to people familiar with the matter.

The plan for a so-called aggregator bank, a variation on a theme that Obama administration officials have wrestled with for weeks, is among four main components of Mr. Geithner's bailout revamp, which he is expected to announce Tuesday......

[nicolezmomma]

We have been trying for a month to buy a bank-owned property. I think they are holding on to it hoping the government (taxpayer) will give them a better offer than we have. Why should the taxpayer pay for their bad judgement? I am totally against a 'bad asset' bank being created.

[Doogle]

guess their trying to forget about the missing 78 billion

[nicolezmomma]

The Treasury's working theory for the government/private-sector partnership is that investors wouldn't overpay, because if they did, they'd stand to lose money; but they also wouldn't underpay, since the selling banks wouldn't be willing to part with their assets too cheaply.

The banks will inflate the actual value of these assets and dump them on the government (taxpayer). There is no incentive for them to do anything else as there are few buyers out there.

[popdonnelly]

The Federal government creates more problems than it solves. It had no qualms about forcing lenders to make bad loans. Now it’s going to buy the bad loans. With our money. My guess is that the next move will be to renegotiate the toxic mortgages. Around and around we go, all financed by the taxpayers - if there are any.

[HangnJudge]

[Neidermeyer]

The banks will inflate the actual value of these assets and dump them on the government (taxpayer).
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And then the gov’t massively inflates the dollar.. savers are suckers.. people that pay their bills are suckers ,, welfare moms will be looked at as if they’re Warren Buffet.

[screaminsunshine]

All this because the government forced the banks to make bad loans on property for far more than the property was worth.

[Norman Bates]

Who has the Geithner Tax Cheat image?

[dawn53]

The plan could include a mechanism to determine the value of homes facing foreclosure, which could speed negotiations with borrowers. The difficulty of valuing such homes is one reason many loan-modification efforts have stalled

Does this mean they are going to write down mortgages?

[1010RD]

I believe that. My bank got $243 million and then stopped lending.

[ex-Texan]

You ain't seen nothing yet. The Arabs are going to be so pissed about their investments evaporating . . .

Video: Dubai Real Estate Crash: 'Bye, Bye Dubai !'

LOL, LOL ! . . .

[elpadre]

the door is now open and the government has stepped inside - within four years the banks will be nationalized.

They are working fast to consolidate their election victory and move the US into European socialism - the Obama team goal

[Dubya-M-DeesWent2SyriaStupid!]

hill and bill will rescue them via king obama false messiah.

[upchuck]

Baby step by baby step, the US banks are being nationalized.

And America takes another step towards turd world status.

[javachip]

"Some critical elements remained unclear, including exactly how the government would entice investors to participate in the private bank, given that they can already buy soured assets on the open market if they want to."

So, part of the brilliant government plan is to HOPE private investors CHANGE their minds and suddenly realize this is a great deal.

[Tempest]

If that were true than why is it that only one of the bailed out banks ever applied for CRA Credits?

Just stop it with the Kool-aid man.

[PistolPaknMama]

Bank Bailout Plan Revamped

Sorry to be totally crass, but isn't this like a "working girl" sponging off after her last appointment? I am SO SICK of of this freak show.

[April Lexington]

Every bank executive in the USA is trying to unload these "assets" (actually, these things are collateralized debt obligations that were created by the five now non-existing Wall Street merchant banks) onto dumb ol' Uncle Sugar. Why would you think that the morons in government would understand the ol' switcheroo?

The banks paid the equivalent of $1,000 per CDO bond and they want the $1,000 back from Uncle Sugar. The CDO is worth between $0 and $1,000 depending on who pays what bills so Uncle Sugar gets to hold the asset and see what happens. If everyone pays their bills, Uncle Sugar could make some money (not that the constitution allows it to make money in this way) BUT... if people don't pay all of their bills, the CDO bonds are worth less (or worthless) than Uncle Sugar paid and WE/YOU/TAXPAYOR gets stuck with the loss. Zimple, no?

[huldah1776]

The banks are using it to cover credit card debt.

[2harddrive]

STOP Porkulus Maximus!