What else do you think the authorities can do?


M

My interest

Fed announced it would buy commercial paper. This essentially means
that it will lend to non-financial companies directly in order to save
the real economy, (i.e. by-pass the banks who may just simply hold off
cash no matter what).

Treasury has got nearly $1Trillion at its disposal to buy whatever bad
assets at (effectively) whatever price.

So in case if this still cannot stop the bleeding, what else can you
think of the authority can do?

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A

Andrew Koenig

So in case if this still cannot stop the bleeding, what else can you
think of the authority can do?
Be patient.

--------------------------------------
Misc.invest.financial-plan is a moderated newsgroup where Moderators strive
to keep the conversations on-topic for financial planning. Other posting
guidelines include a request for brevity and another for trimming posts to
which we respond. For all of the other tips and suggestions, see "FROM THE
MODERATORS: Posting to misc.invest.financial-plan", a weekly post now on the
Newsgroup.
 
H

HW \Skip\ Weldon

Be patient.
Well said.

-HW "Skip" Weldon
Columbia, SC

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Misc.invest.financial-plan is a moderated newsgroup where Moderators strive
to keep the conversations on-topic for financial planning. Other posting
guidelines include a request for brevity and another for trimming posts to
which we respond. For all of the other tips and suggestions, see "FROM THE
MODERATORS: Posting to misc.invest.financial-plan", a weekly post now on the
Newsgroup.
 
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I

Ignoramus19789

Making loans to companies is relatively labor intensive, you need loan
officers, risk managers, attorneys, computer software and databases,
this is a whole mechanism that needs to exist. The Fed or Treasury
does not have that and it cannot be built overnight. I have hard times
believing that they can pull it off. This is also an area that is
prone to corruption.

So I am rather skeptical that the government will be able to actually
make those loans.

The issue that everyone is dancing around, is that a lot of banks have
negative equity due to falling asset prices and fixed
liabilities. Giving them more loans would not restore that equity.

--------------------------------------
Misc.invest.financial-plan is a moderated newsgroup where Moderators strive
to keep the conversations on-topic for financial planning. Other posting
guidelines include a request for brevity and another for trimming posts to
which we respond. For all of the other tips and suggestions, see "FROM THE
MODERATORS: Posting to misc.invest.financial-plan", a weekly post now on the
Newsgroup.
 

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