TheRealMafoo on 23 March 2009
| Kasz216 said: I'm confused with what the government then does with the Toxic assets. Just let them default and not collect on it? Or do they let them default and start repossessing peoples shit. I'm going to guess the first since that's less likely to alienate voters. I mean it looks like they say they're trying to sell them to other people... but who wants toxic assets? |
I think the plan is to somehow partner with private investors. Have these investors run them, and front some money as well so they have a vested interest in a favorable outcome.
So Government is not doing it alone. If no private investor comes forward, they don't buy any assets.
The flaw in this is the most advantages thing for the bank to do is get rid of the worst of there loans (why they are doing this in the first place). What private investor is going to want to front money for theses? I guess if the split was so high (like the government paid 95%), some will, but that just means it's a loss to the government.
