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To: zigzagman who wrote (151464)	3/23/2009 8:35:17 AM
From: zigzagman	Respond to of 312266

US Unveils Toxic Assets Plan: By: Steve Liesman, Senior Economics Reporter 23 Mar 2009 \| 08:12 AM ET The US Treasury Monday revealed details of a plan to set up public-private investment funds that will buy up to $1 trillion in troubled loans and securities at the heart of the financial crisis. Initial market reaction, however, was positive. US stock futures and Asian share markets climbed on Monday in anticipation of the plan. Currencies that were sold off heavily during bouts of market volatility, such as the Australian dollar or sterling, also rose. The Treasury’s complex plan to use private funds to purchase toxic assets uses low-cost government financing, government guarantees and government equity as incentives, people familiar with the matter say. The Obama administration's latest plan comes amid a growing taxpayer backlash about aid to Wall Street. There are two parts to the plan -- one to purchase securities, the other to purchase loans from banks, using a combined $75 to $100 billion of funds from the Troubled Asset Relief Program. These people say the plan will begin with $500 billion, roughly divided between the two different parts, but officials hope to be flexible and adjust the size as markets develop. Taxpayers are potentially on the hook for hundreds of billions of dollars, but officials stress they have built in protections. Elements of the plan have been leaking out to the news media for several days. Two-Prong Approach In the first part of the plan, the government will create around five separate public-private partnerships, with the government investing dollar for dollar along side private capital. These partnerships will bid for the mortgage-backed securities and other assets weighing down the balance sheets of the banks, creating a price through competition. "We don't want the government to assume all the risk. We want the private sector to work with us," Treasury Secretary Timothy Geithner told Wall Street Journal in an interview. The Federal Reserve will open up its Term Asset-Backed Securities Loan Facility for non-recourse funding for these purchases. Additional funding will be available from the TARP for these purchase. The second part of the program uses government and private funds to purchase loans off the books of the banks. Under this program, the Federal Deposit Insurance Corp. will offer guarantees to lenders who finance the purchase of these assets. The government will also invest side-by-side with private capital in the purchases. A bank selling the assets could be likely to finance those assets, with government guarantees. Officials stressed the program is not a "silver bullet" and won’t solve the banking problem by itself. They said it’s part of the broader Financial Stability Plan, which includes a $75 billion foreclosure mitigation plan, the TALF, the capital access program and the bank stress tests. For example, banks that sell assets to the private partnerships for less than the current values on their books could be required to raise capital. The capital access program will make that capital available in the form of mandatory convertible preferred that can be turned into common shares as needed. Treasury spokesman Isaac Baker Saturday declined to comment until details of the plan are announced. Aspects of the plan, however, have been leaking out to various news organizations, including CNBC, over the past few days. U.S. Treasury Secretary Timothy Geithner said on Sunday that help from the private sector was critical to get toxic assets off banks' balance sheets and help resolve a credit crisis. "Our judgment is the best way to get through this is if we can work through the markets," Geithner said in an interview with the Wall Street Journal post to the Internet late Sunday. "We don't want the government to assume all the risk." When he first mentioned public-private investment funds in February, Geithner laid out the proposal in such scant detail that markets sank on fears there was no clear-cut plan for rescuing a banking system beset by poorly performing mortgage and other assets left over from a housing boom that went bust. Geithner said the plan could soak up as much as $1 trillion of toxic assets, which investors would buy at a discount in hope of selling at a future profit, and in the process help establish a market-driven method for pricing such assets. -- Reuters contributed to this article. cnbc.com

To: zigzagman who wrote (151464)	3/23/2009 3:17:51 PM
From: marcos	1 Recommendation Read Replies (1) \| Respond to of 312266

Haven't seen your video charts yet, as i've only graduated from dial-up a few days ago, couldn't then ... but what you post on John P's is highly interesting, you call a lot of critical points well, obviously work at this stuff, a credit to SI, good on ya mate The Russell is the index i follow more than others, seems closer to the favourite type of venture and speckie plays ... do you ever chart it out much, and if so do you see any trends of hotter/cooler than $spx/$indu - stockcharts.com