Quote:
Originally Posted by Zarathustra
A provision of Paulson's swindle, er, plan is to allow banks to reduce their reserve requirement to 0%
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Well that frees 10 times the money of each loan...
I can understand him doing it on the HELOCs, because until the housing market turns around, they are worth nothing. The HELOCs bad paper should be handed over to the Treasury for 5 cents on the dollar, to hold until the market turns around.
So would bailing out each bank be better than just freeing their credit?
for each Nickel these are sold for to the Treasury, the bank can loan 9 times as much, so they instantly recover 50% of what they just lost...
I think this is a pretty quick way to get the wheel turning again.