Sources: Geithner preparing plan to get toxic assets off banks' books with Fed and FD

Discussion in 'Economy' started by wimpy77, Mar 20, 2009.

  1. wimpy77
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    wimpy77 Member

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    Treasury Secretary Timothy Geithner could announce as soon as Monday his much-anticipated plan to get toxic assets off the books of the country's struggling banks, administration and industry officials said.

    The plan will use the Federal Reserve and the Federal Deposit Insurance Corp. to make the resources of the government's $700 billion financial rescue fund go further, the officials said Friday.

    Geithner is being forced to tap the Fed and the FDIC for support because the prospects for getting additional support from Congress for the bailout effort have dimmed significantly given the recent uproar over millions of dollars in bonuses provided to troubled insurance giant American International Group Inc., the largest recipient of government support.

    The officials, who spoke on condition of anonymity because they were not authorized to speak publicly about the Geithner's plan, said it will have three major parts.

    One program will use the bailout fund to create a public-private partnership to back purchases of bad assets by private investors.

    A second portion of the plan will expand a recently launched program being run by the Federal Reserve called the Term Asset-Backed Securities Loan Facility. That program is providing loans for investors to buy assets backed by consumer debt in an effort to make it easier for consumers to get auto, student and credit card loans. Under Geithner's proposal, this program would be expanded to support investors' purchases of banks' toxic assets.

    The third part of the Geithner plan would utilize the resources of the FDIC, the agency that guarantees bank deposits, to purchase toxic assets.

    When Geithner announced the administration's overhaul of the financial rescue program on Feb. 10, he only mentioned using the bailout funds to support the private-public partnership, and he was vague on the details of how that program would work.

    The initial proposal was widely panned by investors, who were disappointed in a lack of specifics. The Dow Jones industrial average tumbled 380 points on the day the original program was announced.

    Geithner's new plan would tap the resources of the Fed and the FDIC to attack what many analysts see as the major failing of the bank rescue effort so far, the failure to rid banks' of more than $1 trillion in bad loans and other toxic assets weighing down their books. As a result, banks have been unable to shake off the effects of the worst financial crisis to hit the country in seven decades.

    While the administration included a placeholder in its budget request last month for as much as an additional $750 billion in rescue funds, more than doubling the current commitment, the uproar over the AIG bonuses has underscored the dim prospects that Congress would vote to bolster the size of the current fund.

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    with the aig flap going on good luck getting the private investors to go along.
     
  2. dilloduck
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    dilloduck Diamond Member

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    With all due respect and honesty---you may as well be speaknig Greek to me and I suspect many others. Will the simple explanation scare the crap out of ordinary folks ?
     
  3. Dr. T. Sanchez
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    Dr. T. Sanchez BANNED

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    Maybe geitner should pay his taxes.
     
  4. manu1959
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    manu1959 Left Coast Isolationist

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    you government is printing money to underwrite private companies and creating a private investment group to underwrite them as well.......

    they are building a financial empire (monopoly) and using tax payer and federal funds to do it.....

    gee look at the list of the group of 30.....Group of Thirty - Wikipedia, the free encyclopedia and you tell me what they are up to.....
     
  5. dilloduck
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    dilloduck Diamond Member

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    ty Manu--I knew I should be worried.
     
  6. wimpy77
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    wimpy77 Member

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    what they want to do its basically do a version of TALF to get private investors, the fed and the fdic to purchase the toxic assets from the bank books.
     
    Last edited: Mar 20, 2009
  7. wimpy77
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    wimpy77 Member

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    i actually read an article on politico similar to the one you provided. it had rumsfeld and others listed as well. i guess that's what people consider to be the nwo. ill see if i can find the article for you manu.


    http://www.politico.com/news/stories/0309/20010_Page2.html
     
    Last edited: Mar 20, 2009
  8. no1tovote4
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    no1tovote4 VIP Member

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    That will make all the difference, it will change 2.83227221 Trillion Dollar Deficits into 2.83227220 Trillion dollar Deficits!

    We are so not ready for the pounding we'll have to take to pay this crap back...
     
  9. manu1959
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    manu1959 Left Coast Isolationist

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    cool....rich people form clubs for the rich and do things to help each other.....not to shocking really.....what is interesting about the group of thirty is who isn't on there and looking at what is happening or happened to their companies.....
     
  10. manu1959
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    manu1959 Left Coast Isolationist

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    seriously go to the link and start reading about some of the people and some of what their companies have been up to.....they are all interwoven and will all benifit from this collapse and susequent bail out.......
     

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