Bailout doubters may want to read this

[capeman]

This won't happen…

 

There are two very relevant statements in there that contradict the argument and put a nail in the idea.

1) The Fed is trading some U.S. Treasurys for mortgage-backed securities to arrest the decline in prices that is pushing up mortgage-interest rates.

These are only temporary trades or swaps. The Fed cannot permanently trade U.S. Treasuries representing it's own assets for junk securities. The bond market would make them pay dearly for this. The swap occurs since the U.S. Treasuries need to be traded back to the Fed at maturity and then the Fed can reinitiate the trade again (likely accepting securities backed by assets of even less value).

2) One big caveat: This works only if assets truly are worth more tomorrow than they'll fetch today.

Who at this point thinks that any lending banks assets will be worth more in the near future than they are today? (Hint: That's why the S&P and Banking Index have been doing so well over the last year!) An even bigger and easier question at this point… Who thinks that the assets backing all of this paper being passed around will be worth more tomorrow than currently? Anyone looking at an ABX, CMBX or CDO spread chart or Case/Schiller HPI can answer this… actually I don't think anyone even has to look anymore!!

The Fed and the Govt' cannot bailout the housing and credit markets at this point without BKing both entities and causing post WWI German-style inflation. Not going to happen! 😉

 

 

[TheBreeze]

I think the bailout has already begun. The Federal Home Loan Banks now have $822 billion in crappy mortgages:

http://emac.blogs.foxbusiness.com/2008/02/25/the-richie-riches-of-the-housing-mess/

Supposedly, the mortgages are just being held as collateral, but somehow I think the taxpayers are going to end up eating those puppies in the end.

Add the $800 billion to the $200 billion the Fed is willing to take in and we’re well on our way to a trillion dollar bailout. What the hell, we’re on pace to blow a couple trillion in Iraq, why not blow a couple trillion more to artificailly inflate housing prices?

The dollar’s down another percent or so and gold’s up again:

http://www.cnbc.com/id/15839171/site/14081545/

It looks like we’re going to go through a pretty nasty period of stagflation. When all is said and done, savers will be punished again (with the dollar collapse) and the speculators will blow another bubble (it looks like commodities this time). Good times.

At least we can take solace in the fact that that Scholes guy that the government appears to be listening to was the father of what got us into this mess in the first place (portfolio insurance):

http://www.portfolio.com/news-markets/national-news/portfolio/2008/02/19/Black-Scholes-Pricing-Model

And to top it all off, the one thing you’d think would be in infinite supply (internet addresses) are supposedly going to be all gone by 2010:

http://it.slashdot.org/article.pl?sid=08/02/22/1348210

What a wacky, wacky world we live in.

[TheBreeze]

I think the bailout has already begun. The Federal Home Loan Banks now have $822 billion in crappy mortgages:

http://emac.blogs.foxbusiness.com/2008/02/25/the-richie-riches-of-the-housing-mess/

Supposedly, the mortgages are just being held as collateral, but somehow I think the taxpayers are going to end up eating those puppies in the end.

Add the $800 billion to the $200 billion the Fed is willing to take in and we’re well on our way to a trillion dollar bailout. What the hell, we’re on pace to blow a couple trillion in Iraq, why not blow a couple trillion more to artificailly inflate housing prices?

The dollar’s down another percent or so and gold’s up again:

http://www.cnbc.com/id/15839171/site/14081545/

It looks like we’re going to go through a pretty nasty period of stagflation. When all is said and done, savers will be punished again (with the dollar collapse) and the speculators will blow another bubble (it looks like commodities this time). Good times.

At least we can take solace in the fact that that Scholes guy that the government appears to be listening to was the father of what got us into this mess in the first place (portfolio insurance):

http://www.portfolio.com/news-markets/national-news/portfolio/2008/02/19/Black-Scholes-Pricing-Model

And to top it all off, the one thing you’d think would be in infinite supply (internet addresses) are supposedly going to be all gone by 2010:

http://it.slashdot.org/article.pl?sid=08/02/22/1348210

What a wacky, wacky world we live in.

[TheBreeze]

I think the bailout has already begun. The Federal Home Loan Banks now have $822 billion in crappy mortgages:

http://emac.blogs.foxbusiness.com/2008/02/25/the-richie-riches-of-the-housing-mess/

Supposedly, the mortgages are just being held as collateral, but somehow I think the taxpayers are going to end up eating those puppies in the end.

Add the $800 billion to the $200 billion the Fed is willing to take in and we’re well on our way to a trillion dollar bailout. What the hell, we’re on pace to blow a couple trillion in Iraq, why not blow a couple trillion more to artificailly inflate housing prices?

The dollar’s down another percent or so and gold’s up again:

http://www.cnbc.com/id/15839171/site/14081545/

It looks like we’re going to go through a pretty nasty period of stagflation. When all is said and done, savers will be punished again (with the dollar collapse) and the speculators will blow another bubble (it looks like commodities this time). Good times.

At least we can take solace in the fact that that Scholes guy that the government appears to be listening to was the father of what got us into this mess in the first place (portfolio insurance):

http://www.portfolio.com/news-markets/national-news/portfolio/2008/02/19/Black-Scholes-Pricing-Model

And to top it all off, the one thing you’d think would be in infinite supply (internet addresses) are supposedly going to be all gone by 2010:

http://it.slashdot.org/article.pl?sid=08/02/22/1348210

What a wacky, wacky world we live in.

[TheBreeze]

I think the bailout has already begun. The Federal Home Loan Banks now have $822 billion in crappy mortgages:

http://emac.blogs.foxbusiness.com/2008/02/25/the-richie-riches-of-the-housing-mess/

Supposedly, the mortgages are just being held as collateral, but somehow I think the taxpayers are going to end up eating those puppies in the end.

Add the $800 billion to the $200 billion the Fed is willing to take in and we’re well on our way to a trillion dollar bailout. What the hell, we’re on pace to blow a couple trillion in Iraq, why not blow a couple trillion more to artificailly inflate housing prices?

The dollar’s down another percent or so and gold’s up again:

http://www.cnbc.com/id/15839171/site/14081545/

It looks like we’re going to go through a pretty nasty period of stagflation. When all is said and done, savers will be punished again (with the dollar collapse) and the speculators will blow another bubble (it looks like commodities this time). Good times.

At least we can take solace in the fact that that Scholes guy that the government appears to be listening to was the father of what got us into this mess in the first place (portfolio insurance):

http://www.portfolio.com/news-markets/national-news/portfolio/2008/02/19/Black-Scholes-Pricing-Model

And to top it all off, the one thing you’d think would be in infinite supply (internet addresses) are supposedly going to be all gone by 2010:

http://it.slashdot.org/article.pl?sid=08/02/22/1348210

What a wacky, wacky world we live in.

[TheBreeze]

I think the bailout has already begun. The Federal Home Loan Banks now have $822 billion in crappy mortgages:

http://emac.blogs.foxbusiness.com/2008/02/25/the-richie-riches-of-the-housing-mess/

Supposedly, the mortgages are just being held as collateral, but somehow I think the taxpayers are going to end up eating those puppies in the end.

Add the $800 billion to the $200 billion the Fed is willing to take in and we’re well on our way to a trillion dollar bailout. What the hell, we’re on pace to blow a couple trillion in Iraq, why not blow a couple trillion more to artificailly inflate housing prices?

The dollar’s down another percent or so and gold’s up again:

http://www.cnbc.com/id/15839171/site/14081545/

It looks like we’re going to go through a pretty nasty period of stagflation. When all is said and done, savers will be punished again (with the dollar collapse) and the speculators will blow another bubble (it looks like commodities this time). Good times.

At least we can take solace in the fact that that Scholes guy that the government appears to be listening to was the father of what got us into this mess in the first place (portfolio insurance):

http://www.portfolio.com/news-markets/national-news/portfolio/2008/02/19/Black-Scholes-Pricing-Model

And to top it all off, the one thing you’d think would be in infinite supply (internet addresses) are supposedly going to be all gone by 2010:

http://it.slashdot.org/article.pl?sid=08/02/22/1348210

What a wacky, wacky world we live in.

[kewp]

And to top it all off, the one thing you’d think would be in infinite supply (internet addresses) are supposedly going to be all gone by 2010:

Who would think there are an infinite supply of 32 bit integers?

[kewp]

And to top it all off, the one thing you’d think would be in infinite supply (internet addresses) are supposedly going to be all gone by 2010:

Who would think there are an infinite supply of 32 bit integers?

[kewp]

And to top it all off, the one thing you’d think would be in infinite supply (internet addresses) are supposedly going to be all gone by 2010:

Who would think there are an infinite supply of 32 bit integers?

[kewp]

And to top it all off, the one thing you’d think would be in infinite supply (internet addresses) are supposedly going to be all gone by 2010:

Who would think there are an infinite supply of 32 bit integers?

[kewp]

And to top it all off, the one thing you’d think would be in infinite supply (internet addresses) are supposedly going to be all gone by 2010:

Who would think there are an infinite supply of 32 bit integers?

[kewp]

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[kewp]

dupe deleted

[kewp]

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[kewp]

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