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Strategies & Market Trends : Anthony@Pacific & TRUTHSEEKER Expose Crims & Scammers!!!
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From: ravenseye11/12/2007 10:43:22 AM
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Some Wonder if the Banks’ Stabilization Fund Will Work
By ERIC DASH
Published: November 12, 2007
When the country’s three largest banks reached agreement on Friday on how to structure a $75 billion fund to prop up distressed securities, an exhausted group of its top planners gathered in a Bank of America conference room to toast their success with 12-packs of Bud Light.

But the celebration might have come too soon.

Having settled on the fund’s composition, officials from Bank of America, Citigroup and JPMorgan Chase will now have to raise more than $60 billion of the fund from dozens of financial institutions around the globe in the next few weeks. The goal is to have the fund operating by the end of the year. But the big question is: Will it actually help?

The answer, some analysts and big investors say, is probably not much. The backup fund will not save troubled structured investment vehicles, or SIVs, that hold billions of dollars in packaged loans, though it could delay their demise. It may help calm the turbulent credit markets by preventing a sharp sell-off of securities, though analysts say the fund will probably not be able to offset the deteriorating prices of the securities....
nytimes.com
...“Will this resolve the basic issue of the assets of the SIV trading below what they were originally?” asked Steven Abrahams, the chief interest-rate strategist at Bear Stearns. “No, it defers the day of reckoning.”

“If the people who organized this are right and the market gets better six months from now, they will look like geniuses,” he added. “If they are wrong, six months from now the problem will just remerge.”
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