Treasury Department Releases Details on Public Private Partnership Investment Program

U S Treasury Fact Sheet

Public-Private Investment Program

View White Paper and FAQs at http://financialstability.gov/

The Financial Stability Plan – Progress So Far: Over the past six weeks, the Treasury Department has implemented a series of initiatives as part of its Financial Stability Plan that – alongside the American Recovery and Reinvestment Act – lay the foundations for economic recovery:

• Efforts to Improve Affordability for Responsible Homeowners: Treasury has implemented programs to allow families to save on their mortgage payments by refinancing, assist responsible homeowners in avoiding foreclosure through a loan modification plan, and, alongside the Federal Reserve, help bring mortgage interest rates down to near historic lows. This past month, the 30% increase in mortgage refinancing demonstrated that working families are benefiting from the savings due to these lower rates.
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  Consumer and Business Lending Initiative to Unlock Frozen Credit Markets: Treasury and the Federal Reserve are expanding the TALF in conjunction with the Federal Reserve to jump start the secondary markets that support consumer and business lending. Last week, Treasury announced its plans to purchase up to $15 billion in securities backed by Small Business Administration loans.
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  Capital Assistance Program: Treasury has also launched a new capital program, including a forward-looking capital assessment undertaken by bank supervisors to ensure that banks have the capital they need in the event of a worse-than-expected recession. If banks are confident that they will have sufficient capital to weather a severe economic storm, they are more likely to lend now – making it less likely that a more serious downturn will occur.
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  The Challenge of Legacy Assets: Despite these efforts, the financial system is still working against economic recovery. One major reason is the problem of "legacy assets" – both real estate loans held directly on the books of banks ("legacy loans") and securities backed by loan portfolios ("legacy securities"). These assets create uncertainty around the balance sheets of these financial institutions, compromising their ability to raise capital and their willingness to increase lending.

COMMENTS

Proceed with caution regarding this multi-phase marketing operation. The links are from the US Treasury so you can determine for yourself what you are dealing with.

We are now witnessing the circus big top. Only the finest and the best will be permitted in the tent to sell you the repackaged toxic assets that the original owners went broke on.

That doesn't mean there isn't opportunity to make a profit. But the key question is who is taking the risk and who is making the money. Folks, you may want to consider letting the bus go by a couple of times before you step on board and go for the ride. Don't worry about missing an opportunity. They have $$ trillions.

James Monachino