Obama Truly is the Candidate of Wall Street
It’s official this is just a ponzi scheme to pay off wall street and especially hedge funds and investment firms:
Arthur Levitt, former chairman of the Securities and Exchange Commission, says crisis management “isn’t pretty.”
By providing $100 billion in cash and many times that amount in loans, the Treasury plan would enable investors to jointly purchase up to $1 trillion in bad loans from ailing banks. If the banks receive high prices on the loans – something Treasury indicates it prefers – the banks would be the primary beneficiaries, analysts say.
But if investors purchase the loans at low prices and the assets later appreciate significantly, the investors would make out like bandits.
“Will people be able to make a killing? Yes,” particularly because Treasury is willing to augment the returns for investors by providing loans worth six times their cash investments, said Arthur Levitt, a former chairman of the Securities and Exchange Commission.
The biggest winners may be the five major investment firms that the Treasury plans to hire to manage the gigantic program, Wall Street executives say. These are almost certain to include Pimco, the big bond fund, and Blackstone, the private equity group, both of which suggested the investment program to Treasury and helped design it.
Of course they like this idea. It is sweetheart deal and a very good chance to make a killing later on, at tax payer expense (and that is the problem).