The thing that I don't about the logic behind all if this is:
The "plan" is for the gov to buy up all this bad paper in order to free up the banks to lend again.
What's being sold to us, the taxpayers, is that the gov will hold these assets and sell them for a profit when the the market bounces back...thus "costing"the taxpayer nothing in the long run.
First, what's to say the market WILL bounce back and profit will be made?
Second, if they think this will work, why not give incentives for those with the money to invest so they can buy up these bad assets?
I mean the gov is telling us this is needed very badly and in the long run it won't hurt the taxpayer.
Let's just leave the taxpayer out of it and give capital gains breaks to those that buy up these bad assets now and sell them later....if they sell and do not make a profit, let them write it off.
This cost the taxpayers nothing.....the only "cost" would be that the gov might not get as much "revenue" being that gave breaks to those willing to step up and relieve the banks from their mistakes.
