Link to Profile Semperoper, Dresden Sieg (auf dem Siegesäule), Berlin Brandenburg Tor, Berlin Skyline, Frankfurt am Main

Friday, January 16, 2009

Bad Bank

Yep, that's the game plan. Create a bad bank, backed by taxpayer money, to take all the toxic assets being held by the rest of the banks so they can start lending again. A few thoughts:

1) How is that different from that evil known as securitization? You know, where you package a number of things like loans and sell off the risk to willing investors willing to bear the risk in exchange for a chance at greater returns. Oh yeah, we don't have a choice in this deal ... we take the risk whether we like it or not.

2) If this problem was caused by an epidemic misuse of credit, how will more borrowing make things better in the long-term?

0 Comments:

Post a Comment

Links to this post:

Create a Link

<< Home