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Die Tarper, or Tire Rims And Anthrax
Feb. 10th, 2009 08:41 amThe banks argue that the few trades of such securities lately have been at unreasonably low prices — ones that would be justified only if foreclosures, and losses on foreclosed mortgages, are far higher than now seem likely.
But the banks have shown little interest in demonstrating their confidence in the securities by buying more of them from one another. Instead, banks have sometimes been unwilling to trust other banks that hold such securities.
That lack of trust, in turn, has spread to the broader international financial system.
If many of those troubled assets can be removed from bank balance sheets, and others seem to have a clear market value, economists hope that banks would feel freer to lend — rather than continuing to hoard capital to protect themselves from further losses. Only then, the experts say, can the banking system get the economy moving again.
Those are the final four paragraphs of Floyd Norris's "U.S. Bank Bailout to Rely in Part on Private Money," New York Times, February 8, 2009. They seem to sum up what the issue is in regard to the bailout (I suppose the Geithner plan could be called TARP done right, if it works. If not, we can call it Die TARP II: Die Tarper).
( I Am Not My Brother )
But the banks have shown little interest in demonstrating their confidence in the securities by buying more of them from one another. Instead, banks have sometimes been unwilling to trust other banks that hold such securities.
That lack of trust, in turn, has spread to the broader international financial system.
If many of those troubled assets can be removed from bank balance sheets, and others seem to have a clear market value, economists hope that banks would feel freer to lend — rather than continuing to hoard capital to protect themselves from further losses. Only then, the experts say, can the banking system get the economy moving again.
Those are the final four paragraphs of Floyd Norris's "U.S. Bank Bailout to Rely in Part on Private Money," New York Times, February 8, 2009. They seem to sum up what the issue is in regard to the bailout (I suppose the Geithner plan could be called TARP done right, if it works. If not, we can call it Die TARP II: Die Tarper).
( I Am Not My Brother )
