Comment & Debate
Camilla Webster. “Don’t Nationalize The Banks”. Forbes. March 4th, 2009 – “The government can end the crisis: just buy toxic securities, guaranty them, roll them up and sell them to the public. […]. [Michael] Jaliman’s[, a senior advisor at Boston’s Vantage Partners,] plan would allow the average investor to seize opportunities that have attracted managers like George Soros to Indymac–these big players get to buy discounted debt with the government taking the first huge chunk of any losses that might result. […] Jaliman would have the Federal Reserve ‘fund private financial firms to purchase whole mortgages, private label mortgage-backed securities and mortgage-backed securities derivatives, clearing them from bank balance sheets and establishing a robust market for these illiquid securities.’ […] Yes, the banks would take write-downs on the sales, but the Treasury could then recapitalize the banks in exchange for nonvoting stock. The Federal Reserve and the private investors would constitute public-private partnerships.”