
Treasury seeks to expand definition of "troubled assets" covered by bailout
I know things are moving fast, but I object to retroactive editing of online articles without any indication that this has been done.
I captured the quote (below) from this article in Bloomberg earlier, but it no longer exists in the linked article. You can still find this quote in the Google cache, but I don't know how long it will remain there either.
"The Treasury's thinking is to make it as big and wide as possible so they have the flexibility to act if need be,'' said Shane Oliver, Sydney-based head of investment strategy at AMP Capital Investors, which manages about $108 billion. "There have been losses on a whole range of U.S. debts and as the economy deteriorates in response to the housing slump those losses could escalate.''
Treasury officials now propose buying what they term troubled assets, without specifying the type, according to a document obtained by Bloomberg News and confirmed by a congressional aide.
This quote caught my attention (and quick capture) because of its blunt honesty and potential implications. Let's think of all the types of debt that could reasonably be considered as "troubled" by the mortgage meltdown.
- Auto loans. Certainly anybody who is losing money on a house might be at risk of not paying off their auto loans, so these are clearly linked.
- Credit card loans. Ditto above.
- Corporate bonds. Well, certainly it can be argued that if we weren't in the midst of a gigantic housing bust, corporations would be doing better. So these are 'linked,' I guess.
- Municipal bonds. Who could argue that municipalities are not worse for the wear due to the housing bust?
- Etc. and so forth.
I think that the fact that this sort of statement/speculation even snuck through provides enough "smoke" that we have to consider it likely that the behind-the-scenes situation is far more grave than has been let on.
Any expansion of the bailout to "troubled loans" will simply mean the end of the dollar as we know it. You can set an egg timer on it.

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19 Comments
What your friend in the treasury dept didn't tell you was they only put the figureheads in jail. The worker bees who implemented all of the past scandals didn't even get their hands slapped - and they are the ones running the show.
Wow, what a time to be alive!
World wide financial collapse (its starting to look like it), Peak oil, and climate change - all happening now! This is the E-ticket of all E-ticket rides in recorded human history!
Now does that put things in perspective?
Jeff
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