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To: TXLibertarian

Because of these previous sales, most of the banks have been required to mark these down to 30 cents on the dollar. That is how accounting works!!

I am not sure where you are getting that the government will pay above market values for these securities. All the press has said they will be buying them at current market values. If you have facts that show otherwise I would love to see it!


59 posted on 09/21/2008 9:39:53 AM PDT by koraz
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To: koraz
All the press has said they will be buying them at current market values.

How is it the current market value if the market won't pay it?

62 posted on 09/21/2008 9:43:09 AM PDT by Mojave
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To: koraz
Because of these previous sales, most of the banks have been required to mark these down to 30 cents on the dollar.

If banks already wrote the assets down to 30 cents on the dollar, and are still solvent, then they have no need to sell them. They can simply hold onto the debt till maturity and profit accordingly.

Personally, I don't believe the mark downs on level 3 assets have been anything close to "mark to market". That's why no one wanted to touch Lehman or Bear after they had a chance to look at the books. And that's why the government will overpay - so truthful markdowns don't result in insolvent banks.

65 posted on 09/21/2008 9:47:54 AM PDT by TXLibertarian (RIP Free Markets 2008)
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