Hank Paulson just announced the outlines of his rescue plan
aimed at purchasing the bad mortgage assets that he said were
"clogging up our financial system" so that capital can begin to
freely flow.
He said this would require a "significant investment of taxpayer
dollars," in the hundreds of billions of dollars.
In addition, he said that Fannie Mae and Freddie Mac, as well as
the U.S. Treasury Department, would increase purchases of mortgage
backed securities.
So the bottom line is that there are these really crappy
investments out there in the market that no private business would
touch with a ten foot pole, so now the federal government will use
taxpayer dollars to purchase them. Splendid.
topics:
Hank Paulson, Business
