Citigroup has proposed the creation of a "superconduit" that would issue short-term debt and buy assets currently held by SIVs affiliated with the participating banks, the Journal reported.
So replacing SIVs with a SuperConduit will solve liquidity problem? If they can't sell SIV bonds, how can they sell Superconduit bonds? Pig in a Poke, anyone?
Importantly, none of these Ponzi tricks can solve the Fundamental problem, which is:
Between 2006 to 2010, the National "Wealth" is going to decrease by 50%. Yes, you read it right, because most of the national "Wealth" is equity in homes. How can this huge "destruction" of wealth be made invisible? I have put quotes to show that this bulking up of wealth was illusory and the loss is also illusory. But the effects of the loss can't be hidden anymore than the effects of gains were hidden.
