pam923 - Massive bailout of financial industry-proposed by...

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Massive bailout of financial industry -proposed by president bush, must pass congress -features of bush’s proposal: -secretary of treasury would have sole authority to decide what assets to buy from banks; his decision cannot be reviewed by any agency or overturned by any court -from whom could he buy assets? Any bank w significant presence/labor force in US, which includes many international banks(e.g. UBS, Credit Suisse, etc.) -what assets could he buy? Left to his discretion. Mortage-backed securities, certainly, but others too -at what price? Whatever Paulson chooses. Presumably higher than current… continue… -----congressional democrats want changes to proposal: -US government to receive shares in companies that sell US bad debt -relief for homeowners at risk of foreclosure --several members of congress of both parties oppose any bailout --likely costs and consequences: -$700 billion cost-largest government bailout of private industry in US history
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This note was uploaded on 11/27/2008 for the course PAM 2000 taught by Professor Evans,t. during the Fall '07 term at Cornell.

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pam923 - Massive bailout of financial industry-proposed by...

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