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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: patron_anejo_por_favor who wrote (192718)	3/23/2009 6:17:15 PM
From: orkrious	Read Replies (1) \| Respond to of 306849

from Fleck tonight on the PPIP Along those lines, governmental shock-and-awe prompted these comments from the Lord of the Dark Matter: "I would like to offer some observations on the merits, or otherwise, of this latest plan before the details are announced: (A) As per Secretary Geithner's article in the WSJ, this is not a capital vehicle but yet another liquidity vehicle; (B) To write assets down to a transfer price that pension funds and other possible participants decide makes sense requires capital, not liquidity; (C) Most assets that will be a problem going forward are not in trading books but in accrual books/held-to-maturity books and remain marked close to par; (D) Implicit in the PPIP is the notion that participants will readily assume that the re-enactment of the Salem Witch Trial last week in D.C. was a one-off, and that politicians and others are not going to come after anybody who may make either reasonable or outsized gains from the PPIP going forward." He and I chatted at midday. We both agree that this plan won't "work," as no impaired financial entity (ex those firmly in the clutches of the government) will want to hit bids and realize the losses that they have. Hence, the "toxic" assets are liable to remain frozen. fleckensteincapital.com