Comments on: Gaming the Legacy Loan Auctions

By: Fed Up

Fed Up — Thu, 02 Apr 2009 01:40:26 +0000

I think Adios Amigos has cut to the heart of it. The majority of these “assets” will be worthless and become the taxpayers problem. This is really the the point that needs to be made somehow. I think there are many,many people in this country that would readily fight… We just need to create a voice, a forum to be heard. It’s clear that our “representatives” will not be that voice.

By: tgb

tgb — Wed, 01 Apr 2009 15:54:43 +0000

The regulation requires that the seller have no more than a 10% interest in the buyer. I am sure that the final draft will state this as a direct or indirect interest, so your scenario would be fraud.

Also, PIMCO is going to make a mint on these trades as well as in advisory fees for managing the govt portfolio. Why would they risk their franchise as well as their profits to assist anyone in circumventing the regulations. Even if a seller bank were so incentivized, they would have a hard time finding a partner.

By: adios amigos

adios amigos — Wed, 01 Apr 2009 02:21:45 +0000

When the Americans sell us here in Norway their toxic investment scams and they take our money from our pensions after thirty-odd years of savings, is that “Taking”? Or…..is that fraud? I’m just not sure, and I certainly wouldn’t want to offend any of those trustworthy Americans.

By: adios amigos

adios amigos — Wed, 01 Apr 2009 02:18:09 +0000

TAKING?????????????????? They certainly had no problem TAKING the money fro our pension funds here in Europe when the Americans sold us their toxic investments. Oh…..you mean taking THEIR stuff in America. Yeah, I forgot, they only have no problem TAKING when it’s actually outright fraud. I forgot !! oops

By: Game Based Learning | Online creative communications

Game Based Learning | Online creative communications — Tue, 31 Mar 2009 10:57:40 +0000

[...] Gaming the Legacy Loan Auctions « The Baseline Scenario [...]

By: 1 currency now

1 currency now — Tue, 31 Mar 2009 06:28:25 +0000

Ok then we tax banks into nationalization, instead of changing the rules in their favor at the last minute so they can feast on one another’s losses.

I’m suggesting the takings doctrine will prove elastic in the unwinding of 1.28 quadrillion dollars. Would the reimposition of Glass-Steagall be “sudden unexpected regulation”? How about reducing FDIC insurance back to 100k, and limiting individuals to x number of insured accounts. Then sell short term T-Bills at high interest. Take that!

By: Ilya Podolyako

Ilya Podolyako — Tue, 31 Mar 2009 03:31:50 +0000

No. The Supreme Court has always looked at taxes through a completely different lens; basically, the takings doctrine does not apply to taxes.

By: 1 currency now

1 currency now — Tue, 31 Mar 2009 03:13:46 +0000

That was me, sorry.

When they change income tax rates suddenly to reflect crisis conditions, is that a taking?

By: Anonymous

Anonymous — Tue, 31 Mar 2009 03:11:16 +0000

When they change income tax rates suddenly to reflect new crisis conditions, is that a taking?

By: Anonymous

Anonymous — Tue, 31 Mar 2009 03:08:45 +0000

Sudden revision? Fasb just changed the rules under Congressional pressure. Just in time for next quarter. Yes, there will be detrimental economic effects.

They’re called toxic for a reason. If the FDA finds out the saccharine they’ve been approving for years is toxic, they ban it the next day. Forget taking, they can’t even use it to get out of tort liability.

By: Gaming the Legacy Loan Auctions « The Baseline Scenario « US Economic Views

Gaming the Legacy Loan Auctions « The Baseline Scenario « US Economic Views — Tue, 31 Mar 2009 00:48:42 +0000

[...] a comment » Gaming the Legacy Loan Auctions « The Baseline Scenario: Financing Is Provided Through FDIC Guarantee: If the seller accepts the purchase price, the buyer [...]

By: Wandering Mind

Wandering Mind — Mon, 30 Mar 2009 17:28:56 +0000

What I have been wondering about this plan is whether, if the banks decide to sell some of their bad assets backed by mortgages, the buyers will have to agree to modify those mortgages to make it more likely that the homeowner will stay in his/her home. Does anybody know?

By: Ilya Podolyako

Ilya Podolyako — Mon, 30 Mar 2009 17:11:26 +0000

The bulk of constitutional law on the topic suggests that such a sudden revision of an existing standard would itself be a taking if it was unexpected and had detrimental economic effects. This is exactly the point I was trying to highlight in my posts.

By: emailers2

emailers2 — Mon, 30 Mar 2009 12:56:56 +0000

Could this change raise the cost of the toxic assets to the PPIP? Not to mention creating the illusion of solvency. As for me I am not buying any financial’s until this shakes out.

Mark-to-Market Lobby Buoys Bank Profits 20% as FASB May Say Yes

http://www.bloomberg.com/apps/news?pid=20601109&sid=awSxPMGzDW38&refer=home

By: Linus_Wilson

Linus_Wilson — Mon, 30 Mar 2009 12:49:33 +0000

Even if banks are not constrained by marking down assets and drawing the wrath of regulators, banks’ shareholders will be hesitant to sell their assets at even above market prices according to my paper “The Put Problem with Buying Toxic Assets” at http://ssrn.com/abstract=1343625.