5.01.2008

Banker's Backstop

So the banks have loans that they can't sell in the open market and because of this student loans are in jeopardy. So instead of the government providing student loans (BECAUSE THIS IS TO MAKE SURE STUDENT CAN GO TO COLLEGE OF COURSE) which is option 1.bad, they are instead going to bail out the private institutions and purchase, at above market prices, those loans, option 2. super bad. HERE

Which would cost more I wonder since the loans are worth what the banks think they are, wouldn't it make more sense to not pay their "market rate" and just finance themselves? Again I don't like that idea either but they are rewarding bad business.

Privatize profit, socialize loss. Big fan of the former; pure dripping hatred for the latter.

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