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Your Money Backs More Bad Debt

Posted on March 26, 2008

Regulators are playing with fire, said Allan Meltzer, a Fed historian and economics professor at Carnegie Mellon University in Pittsburgh. With good luck, none of these liabilities will come due. We can t expect that good luck, and we haven t had it. Bloomberg (March 26, 2008)The reason you want solid collateral to secure a loan is obvious. You want to protect adequately against the borrower s potential inability to pay you the loan back. How interesting that the Fed is taking 30 $ Billion of illiquid mortgage securities as collateral from otherwise insolvent Bear Stearn...

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