Kyros on 10 November 2008
Often at interest rates below inflation, meaning they are indeed giving money away.
In Europe the conditions were pretty good for the government. The interest is pretty much what loans did cost before the whole bubble. Don't know about the conditions in the States. (Although they outright bought AIG and will get money from their investment if the company survives this). Money may be lost but this is hardly stimulating the economy. These plans include giving money to buyers not to banks.
What about the plans to purchase bad mortgages from banks?
They don't do this yet, do they? Its definitely not happening in Europe, here government intervention works on two levels: Investment in banks (buying parts of them) and guarantees for interbank lending. But yes if they do this and the market drops they will loose money. But that is also not the stumulus package but an attempt to keep the banking sector and with it the whole economy from drowning.
Sure, but what does that have to do with this thread?
I just wanted to put the "China's response puts the Western governments to shame" into perspective.
