Treasury Archive

Why it matters how the 700 billion is accounted for

[Skip to the end] It would be counter productive to add the $700 billion to the budget deficit calculation if the proposal goes through and is executed, since Congress is likely to take measures to somehow constrain spending or increase revenues to try to ‘pay for it’. This would be highly contractionary ...Read More

Congressional confusion

[Skip to the end] Congress seems confused over who are the bad guys that need to be punished. They seem to be leaning towards punishing shareholders if their management decides to accept any form of federal assistance under the new plan. This puts management in a bind: sell a few securities to ...Read More

Treasury plan cont’d

[Skip to the end] This is what was submitted: Treasury fact sheet on asset plan Treasury will have authority to issue up to $700 billion of Treasury securities to finance the purchase of troubled assets. The purchases are intended to be residential and commercial mortgage-related assets, which may include mortgage-backed securities and ...Read More