May I Please Have $700 Billion? Please?
This economic meltdown is resulting in the largest bailout since the great depression. With $700 billion, the government would be able to buy the bad debt of any financial institution for the next two years. The debt ceiling would be raised from $10.6 trillion to $11.3 trillion. But there is no provision for the government to get anything in return.
Under this plan the Secretary of the Treasury would have broad powers to buy and see mortage-related assets with little congressional oversight. Not everyone is, you’ll pardon the expresson, “buying” this.
In a session with House Democrats, they described a plan where the government would in essence set up reverse auctions, putting up money for a class of distressed assets – such as loans that are delinquent but not in default – and financial institutions would compete for how little they would accept for the investments, said Rep. Brad Sherman, D-Calif., who participated in the conference call.
“You give them good cash; they give you the worst of the worst,” Sherman said. A critic of the plan, he complained that Bush and his economic advisers were trying to panic lawmakers into rubber-stamping it.
Let’s just hope John McCain and his promoters keep telling us how strong our economic fundamentals are. Or did the word “strong” suddenly morph into “crisis”?Click here for reuse options!
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