US Widens Scope of Bad Debt Plan Beyond Home Loans

Discussion in 'Politics' started by JustChristian, Sep 22, 2008.

  1. JustChristian

    JustChristian
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    US Widens Scope of Bad Debt Plan Beyond Home Loans
    By Dawn Kopecki
    http://www.bloomberg.com/apps/news?pid=20601087&sid=a7iCv1F0kuvQ&refer=home

    Sept. 22 (Bloomberg) -- The Bush administration widened the scope of its $700 billion plan to avert a financial meltdown by including assets other than mortgage-related securities.

    The U.S. Treasury submitted revised guidance to Congress on its plan late yesterday as lawmakers and lobbyists push their own agendas. The department also adjusted its plan to insure money-market funds to limit protection to balances as of Sept. 19, after complaints from bank lobbyists.

    Officials made the changes two days after unveiling plans for an unprecedented intervention in financial markets. The change to potentially allow purchases of instruments such as car loans, credit-card debt and other devalued assets may force an increase in the size of the package as the legislation proceeds through Congress.

    ``The Treasury's thinking is to make it as big and wide as possible so they have the flexibility to act if need be,'' said Shane Oliver, Sydney-based head of investment strategy at AMP Capital Investors, which manages about $108 billion.

    ``There have been losses on a whole range of U.S. debts and as the economy deteriorates in response to the housing slump those losses could escalate.'' Treasury officials now propose buying what they term troubled assets, without specifying the type, according to a document obtained by Bloomberg News and confirmed by a congressional aide.

    `Significantly Higher'
    ``The costs of the bailout will be significantly higher than originally considered or acknowledged,'' said Josh Rosner, an analyst with independent research firm Graham Fisher & Co. in New York. ``How, given these changes, can the administration and Federal Reserve believe they are being forthright in their unrevised expectation of future losses?''
     
  2. LadyEagle

    LadyEagle
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    Okay, maybe we should all just default on our credit cards and let the feds have them. The AC will end up getting them anyway once some of us are outta here. :tonofbricks:
     
  3. ReformedBaptist

    ReformedBaptist
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    Maybe the Amills will be able to stick around and let the AC have our credit card debt. whoo hoo!
     

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