Resolution Trust Corp (loan, real estate, debt, mortgage)

[baystater]

Stocks surge on report of entity for bad debt - Yahoo! News

CNBC said Treasury Secretary Henry Paulson is considering creation of an entity like the Resolution Trust Corp. that was formed after the failure of savings and loan banks in the 1980s

Do any of you think this is going to truly stop the bleeding? And if so. why?

[evilnewbie]

Its complete BS... The market went up because governments injected over 250 Billion into the market... just like the Fed did two days ago when they injected 50 Billion and the market went up 100+ points... as to the Resolution Trust Corp... am I reading this right... the government is taking ALL bad debts from everybody and putting it on taxpayers shoulders? Can anyone confirm this? What the hell is going on? Has the world gone mad? Trillions of dollars in bailouts?

[kwalk65]

Originally Posted by evilnewbie

Its complete BS... The market went up because governments injected over 250 Billion into the market... just like the Fed did two days ago when they injected 50 Billion and the market went up 100+ points... as to the Resolution Trust Corp... am I reading this right... the government is taking ALL bad debts from everybody and putting it on taxpayers shoulders? Can anyone confirm this? What the hell is going on? Has the world gone mad? Trillions of dollars in bailouts?

Perfectly said!!! Taxpayers to the rescue ----- AGAIN!!!!

[goodbyehollywood]

They gave no details... because it's a seat of the pants idea that clearly has not been thought through. Once they sit down and look at it objectively, instead of desperately, they'll realize it can't work. Notice Paulson said they're considering it-- he didn't commit to it. They had to do something. Global governments injected 1/4 of a trillion dollars into the markets and the trend was still down. Any attempt at stabilization was met with selling. So Paulson tried another Hail Mary. You gotta give the guy points for creativity.

I think they just want to make it till the weekend, when everybody can put their heads together and say WTF! Tomorrow should be interesting. I doubt traders will want to hold positions over the weekend.

[Bob The Builder]

The Trillions in Mortgage Backed Securities is worth something. The problem is how much or how little. The institutions holding them are unable to value them and are unable to unload them. Therefore no liquidity and the institution dies taking our economy with them.

I would personally love to buy them at a deep deep discount. Would you buy at 5 cents on the dollar? 10 cents? 1 cent? This could be an opportunity for the Government to make a nice profit

[evilnewbie]

Somehow I don't see the government making any profit... if there were profits to be made, they would sell it for what they bought it at so that corporations would profit off of it... all it takes is several lobbyists to make that happen... we take the risk but we certainly won't take any profits... "if" there are any to be made which I doubt..

[HappyTexan]

So they will shift all the debt out of the banks and to this new gov't entity ?
And who the heck is supposed to pay all these debts ?

This is no solution. Well I guess it is a solution for the banks..they have a clean slate now and can start on the next new toxic investment.

[Nor'Eastah]

Actually the RTC wasn't such a bad idea. We got our house after a private contractor bought it from the RTC and put all new everything into it. It's beautiful now!

So far as I can figure, the private contractor made all the profits. Nobody would have bought our house before, it needed too much work.

If you could depend on the foreclosed-upon to just mail in the keys and leave, we wouldn't need this stuff. But lots of them are trashing the places first. Too bad.

[Richard Lyon]

Has anybody ever seen a final accounting of the RTC? Did the government ultimately take a loss on the whole thing?

Part of this is a matter of timing. Real estate will eventually go up in price if you can afford to hold onto it long enough. The government has a longer time frame than private investors.

[lchoro]

Originally Posted by evilnewbie

Its complete BS... The market went up because governments injected over 250 Billion into the market... just like the Fed did two days ago when they injected 50 Billion and the market went up 100+ points... as to the Resolution Trust Corp... am I reading this right... the government is taking ALL bad debts from everybody and putting it on taxpayers shoulders? Can anyone confirm this? What the hell is going on? Has the world gone mad? Trillions of dollars in bailouts?

That started to fail intraday so they brought out the short sale bans and the RTC. That's what they did in July when they coordinated interventions in the stock market, short sales, Fannie/Freddie, commodities, and the dollar.