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To: SouthFloridaGuy who wrote (1555)	11/29/2007 11:38:12 PM
From: Sunny Jim	Read Replies (1) \| Respond to of 1718

<< the point is to solve THIS problem, the Fed needs to PRINT MONEY NOW and monetize this bad debt before it creates MORE bad debt>>. When you say monetize this bad debt by the FED printing more money, I'm puzzled how that solves the problem. I'm assuming the way that would work would be that the FED makes money available to the banking system so that the bad debt can be rolled over rather than it being defaulted on. That assumes that the borrowers of that debt somehow become able to pay it back or at least pay the interest on it and keep rolling it over. Isn't the reason that it is bad debt because the borrowers don't have the ability to service it? Isn't the FED's providing money just hiding or deferring the problem? Ultimately if the economy is slowing down fast enough, the FED may not be able to prevent debt defaults unless they are willing to underwrite the debts if the banks decide that they don't want to do it (because the borrowers aren't credit worthy enough to have the debt rolled over). Sorry if these appear to be stupid questions, but I would appreciate any answers that you can provide.

To: SouthFloridaGuy who wrote (1555)	11/30/2007 10:07:04 AM
From: John Vosilla	Read Replies (1) \| Respond to of 1718

UPDATE 2-US housing-related spreads tighten after plan. NEW YORK, Nov 30 (Reuters) - Credit protection costs fell sharply on housing- and mortgage-related companies on Friday following news that the U.S. Treasury is close to announcing a plan to freeze payments for troubled subprime borrowers. The cost of protecting Washington Mutual's (WM.N: Quote, Profile, Research) debt with credit default swaps fell nearly 73 basis points to about 300 basis points, or $300,000 a year for five years to protect $10 million of debt. Toll Brothers' (TOL.N: Quote, Profile, Research) credit protection costs fell about 24 basis points to about 268 basis points, according to Markit Intraday. Treasury Secretary Henry Paulson discussed the plan at a meeting with top banking regulators and industry representatives on Thursday and is expected to announce details of the proposal as early as Wednesday, sources familiar with the meeting told Reuters. For details see [ID:nN30421799]. Increasing hopes for an interest rate cut by the Federal Reserve also pushed credit protection costs broadly lower on Friday. The main index of investment-grade credit default swaps tightened about 5.5 basis points to about 72.2 basis points, according to Markit Intraday. Fed Chairman Ben Bernanke on Thursday said financial strains had dimmed the outlook for the U.S. economy, signaling an openness to cutting interest rates again. reuters.com OT. REO's usually are listed in MLS and you buy with escrow and title insurance like you would normally buy any home the traditional way..no lien risk on your part