Thread: Government being pressured to buy 'toxic waste'.

  1. #1
    Malum in se abachler's Avatar
    Join Date
    Apr 2007

    Government being pressured to buy 'toxic waste'.

    Wall Street is pushing the govt to buy up the toxic waste portion of repackaged debt, but of course refuses to recombine the effected instruments into a viable whole. In other words they want the govt to agree to absorb any losses on the loans and they get to keep all the profit. Except its worse than that, the govt would have to absorb all the losses on individual defaults, not just overall losses on the whole package, while wall street would keep all the profits on the individual loans. I think they are just trying to take advantage of Obama's lack of experience in economic matters.

    I think wallstreet needs to be forced to recombine the debt if it wants a bailout. They didn't learn their lesson about repackaged debt in the 80's what makes anyone think they will learn it this time?

    If recombined, the loans woudl not suffer a capital loss, they just wouldnt turn as much of a profit. Wall street isnt going to go broke, they just wouldnt make as much money.
    Last edited by abachler; 02-09-2009 at 08:17 PM.

  2. #2
    Lurking whiteflags's Avatar
    Join Date
    Apr 2006
    United States
    So it's not pollution then ...

  3. #3

    Join Date
    May 2005
    This and its equivalents happens roughly once a decade (since the GD). That is why I'm not particularly worried (granted, I have several job offers).
    I'm not immature, I'm refined in the opposite direction.

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