Thursday, April 2, 2009

Bailed-out banks eye toxic asset buys

Voltron says: The treasury department's criteria for participation in the PPIF are so exclusive that only the failing too-big-to-fail institutions will be buying and selling legacy (toxic) assets from each other! Re-arranging the deck chairs on the Titanic.

Excepts FT:

US banks that have received government aid, including Citigroup, Goldman Sachs, Morgan Stanley and JPMorgan Chase, are considering buying toxic assets to be sold by rivals under the Treasury's $1,000bn (£680bn) plan to revive the financial system.

The plans proved controversial, with critics charging that the government's public-private partnership - which provide generous loans to investors - are intended to help banks sell, rather than acquire, troubled securities and loans.

Spencer Bachus, the top Republican on the House financial services committee, vowed after being told of the plans by the FT to introduce legislation to stop financial institutions "gaming the system to reap taxpayer-subsidised windfalls".

Mr Bachus added it would mark "a new level of absurdity" if financial institutions were "colluding to swap assets at inflated prices using taxpayers' dollars."

Full article:

No comments: