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BGonline.org Forums
Will Stock Market Tanking Hurt BG Attendance?
Posted By: Perry Gartner In Response To: Will Stock Market Tanking Hurt BG Attendance? (Barry Silliman)
Date: Tuesday, 30 September 2008, at 11:03 a.m.
How would you respond to a package from Congress that would guarantee the Federal Government a positive rate of return? I mean virtually a no risk deal. One such scenario would be for the Feds to call it a loan rather than a purchase. These loans would become long term debt to the Government with a market interest rate. The cash infusion and the re-structured balance sheets would solve the confidence problem. The government would hold onto these mortgages, lets say for no longer than 5 years and credit the banks with the revenue upon each sale. Any shortfalls would be added to the principal owed the govenment by the banks. Profits would reduce the principal owed so the banks would accelerate the pay back. Most experts think that the bulk of these mortgages will turn positive within 5 years.
What i am suggesting is not far from the deal that was rejected except that it poses less risk for the government. I am making the government a creditor rather than a shareholder. In the long run the outlook for the banks are positive so even the current deal looks likely not to cost the taxpayers anything.
But you could still be uncomfortable philosophically with the gonvernment intervening. If you knew that not intervening meant a deep recession or even a depression with the consequences not only having a devasting impact on many American families, but also our ability to defend ourselves were to be compromised, would you still oppose any plan? Are you merely for strengthening regulations?
Incidentally, you must know saying rollouts bore you on this site raises the question of what you are doing here.
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