nmap, Is it correct to assume that this article on the governments action, forestalls a world wide depression, caused by the bad bets in the mortgage markets? And is it also true, that the sub prime mortgage market that was created is linked to the Feds willingness to lend banks money without oversight on their balance sheets? If they are both true, is it correct to assume that by creating this new agency, the Government is, in essence, buying out the debt via a guarantee on the American economy and taxpayer?
If these assumptions’ are correct; how then are those who made their bets in this market held responsible. Secondly, would not the Government take possession of the assets as well as the debt? And would the debt be sold off, a la Milkins junk bonds, which create a new market? And the hard assets, would they be sold?
Or, are we, the American people, guaranteeing a bad portfolio with no hard assets and nothing to recover or sell?
http://www.bloomberg.com/apps/news?p...B.Y&refer=home