1) No reform -- the bailout bill refuses to address any of the government regulations that caused the problem to begin with. The "private profits, socialized losses" issue will still be there.
2) Assume for a moment that the claims of panic driving down the value of assets are right, this bill isn't the right way to solve the problem. Other more direct reforms would be to get rid of the government accounting regulations. Or providing temporary bridge loans as opposed to having the government have to buy all these assets.
3) Not clear that it is needed. The claim about panic driving down the value of assets doesn't make a lot of sense. We keep on hearing that these assets are actually below their real value and that the government will make money buying these assets now and reselling them later. If so, why won't private parties around the world see the same profit opportunities?
4) Why would we be bailing out foreign financial institutions?
2) Assume for a moment that the claims of panic driving down the value of assets are right, this bill isn't the right way to solve the problem. Other more direct reforms would be to get rid of the government accounting regulations. Or providing temporary bridge loans as opposed to having the government have to buy all these assets.
3) Not clear that it is needed. The claim about panic driving down the value of assets doesn't make a lot of sense. We keep on hearing that these assets are actually below their real value and that the government will make money buying these assets now and reselling them later. If so, why won't private parties around the world see the same profit opportunities?
4) Why would we be bailing out foreign financial institutions?
Related Posts
Housing prices continue to head downFrom the WSJ:S&P/Case-Shiller reported that its indexes ended the first quarter of 2012 at new lows. The - Seasonally adjusted housing price index slipped by 0.1 percent last monthWashington DC dominates the numbers with the only area showing an increase in prices over the last year. The next best
- This high denial rate among mortgage lenders is a result of Obama's policiesThe government forces mortgage lenders to make loans that they didn't want to make, now the government wants them to re
- So how does the housing market look?My own guess is that with the tax changes that are being discussed in Washington housing is not going to be a very good
- "Dems push Fannie, Freddie regulator on mortgage write-downs"Do Democrats have any idea what these types of policies will have on new loans being made? If you can have a loan you
- Banks pressured to buy sovereign debt: When will government realize the problems from forcing banks to make risky loans?Government forces banks to lend money to risky borrowers. Now they force banks to lend money to governments. &nbs
Notes on the Bailout
4/
5
Oleh
abudzar
