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Politics : GOPwinger Lies/Distortions/Omissions/Perversions of Truth
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From: geode009/23/2008 4:15:38 PM
1 Recommendation  Read Replies (1) of 173976
 
So now Bernanke wants to prop up asset values just because?

What?

Whatever happened to Republican 'free market is the best' garbage? Isn't that their 30 year mantra?

votenobailout.org

Avoiding fire-sale price is key to Paulson plan: Bernanke

By Greg Robb
Last update: 11:23 a.m. EDT Sept. 23, 2008

Comments: 32

WASHINGTON (MarketWatch) -- Federal Reserve Board chairman Ben Bernanke said that criticism of the $700 billion plan proposed by Treasury Secretary Henry Paulson overlooked a key ingredient: it is designed to avoid forcing banks to sell or value their mortgage assets at a "fire-sale" price.

In a harsher tone than he has ever used in testimony, Bernanke spelled out the benefits that would accrue when the government can buy these mortgage assets at close to "hold to maturity" prices instead of the fire-sale price. Banks would have a basis for valuing the assets and won't have to use fire-sale prices and their capital won't be unreasonably marked down, he said. Liquidity should begin to come back to the markets and uncertainty should dissipate.

Credit markets should start to unfreeze, he said. If the assets are purchased near the true hold to maturity prices, taxpayer losses should be minimal, he said.
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