Offered by saving $ 200 billion by banks this week is that more clear from the day on which banks are insolvent. The Fed makes a futile attempt to prevent the further collapse of the theft of public funds due to inflation and trade in new funds for subprime loans. The more support the system can be maintained only worsen the inevitable collapse.
The rescue plan, like others before, is an attempt to eliminate the Fedenough toxic mortgage debt bank balance sheets to keep the system more financially sound, although weak at the moment. Total collapse of major banks in the country that must be done properly to bring other banks. When people recognize that they are not alone in facing financial ruin and foreclosure and their money from banks, the largest financial institutions could not survive without large ransom.
TheseBanks have already burned most of their reserves to cover losses stemming from exposure to the mortgage crisis and took as much as possible from each other and foreign investors. The fire sale of U.S. companies to foreigners is just the beginning, but do not buy when our institutions are on the verge of bankruptcy. While other banks, credit has dried up, the Fed as a dump of last resort for banks and their residues, veryinflated mortgages.
Currently, the debt still preserved some semblance of legitimacy has been approved by the bond rating agencies, so the Fed is more than willing to maintain the farce of Treasury trading for them. A little 'more money (dollars, euros, Swiss francs and other currencies) is used to collect the money after a very bad track at the expense of those with the best price.
Therefore, banks will be able to move with a value of 200 billion dollars of bad loans from itsShares in exchange for new loans from the Fed in the form of bonds to strengthen its reserves and reduced to appear solvent. But it is very doubtful that these lives actually fool someone who owns a house in a neighborhood, or investment banks, hedge funds and other institutions that are exposed to the mortgage crisis.
The mortgage crisis is much more than a few regional markets and infects the proliferationmore than 200 markets around the country. Florida and California have at least 33 hours each in soft markets, counties and cities and the values in some areas rose faster and higher than in other communities. These are the markets where it will be much of a bad debt to be traded on the Federal Reserve. (Otherwise, if the banks had generally good debt would be a plan to save the U.S. Federal Reserve in the first place, then, the debt must come from this sad and difficult problemsMarkets).
The Fed, however, is from bank loans, despite their previous loans spectacular failure. Inflation will continue to increase the cost of consumer goods, including food, energy, and what (all the dissipation of energy to the economy, in particular). But at least the owners their mortgage payments or problems to keep warm, or feeding their families can rest assured that your bank does not feel any pain financialdrive from their homes.
And because the inflated values of these properties continues to drop and more homes on the market empty for a long time, bankruptcy restrictions can only push more homeowners abandon their homes more and more value. This is the legal and financial framework of the banks themselves have created. And what will the new design, the public will lose their homes and the cost of saving outBanks.