Bracing against the wind  
www.documentroot.com  

Thursday, November 13, 2008

These Bailouts Make Me Sick

The aren't helping at all, the market has tanked despite hundreds of billions spent, and, honestly, we need these companies to *go out of business* and new companies, that don't mismanage, to take their place.

If the government had *bought houses* from people with bad mortgages, and then *rented* them back to them at rates they could afford, we would see a) an immediate improvement in mortgage-backed securities markets and b) people getting to stay in their houses and c) the government would own real estate assets - which would appreciate eventually and could then be sold at break even say over the next 20 years.

Some quick math. Average home price of depreciated and foreclosed assets: $110000. TARP: 700 billion. Total number of homes that could be purchased: 6 million. Total number of bad-asset homes 4 million.

In other words, the government could buy *all* the mortgages ... for less than the TARP total, and still have money left over.

Instead, Paulson (who should be fired), bought *stock* in banks. Who used the money to pay for CEO's yachts (7.4 billion approx in additional distressed firm bonuses paid due to government intervention).

These are the *same* banks who couldn't be trusted.... and he trusted them. He's an idiot and should be sacked.

[View/Post Comments] [Digg] [Del.icio.us] [Stumble]

Home | Email me when this weblog updates: | View Archive

(C) 2002 Erik Aronesty/DocumentRoot.Com. Right to copy, without attribution, is given freely to anyone for any reason.


Listed on BlogShares | Bloghop: the best pretty good | Blogarama | Technorati | Blogwise