Question: How to fund a $1 trillion buyout of toxic "assets"

[denem]

Answer: The Fed buys a $1 trillion of US treasuries, canceling them.

This of course is Taboo, because it involves the Federal Government, creating or "printing" money, which rather overlooks the fact that financial institutions create money all the time, including the $1 trillion of "toxics" that is now worth more or less nothing.

[depakid]

1. A transactions tax for short term securities trading

and a Tobin tax on currency exchange. Closing capital gains loopholes on certain individuals and entities.

Together that'd go a long way.

[denem]

2. The Tobin Tax ... that takes me back

to the day. I also remember the debates between taxing pollution vs banning it. Interesting now that we are back to a carbon tax.

[mbperrin]

3. No need to fund. Like anyone else who gets conned, those who

own them have nothing but a lesson on what to avoid in the future.

I can never understand why, when you take a counterfeit bill and discover, the Secret Service comes and takes it as evidence, but you get nothing - you're just out. Yet, all these "best and brightest" somehow deserve to get their money back from my pocket.

Odd, isn't it?

[denem]

4. Actually, you are entitled to recover the money on a counterfeit bill.

Unless it was a gift, there was a contract, and a contractual obligation to pay legal tender. The difficulty is locating the other party ;)

[mbperrin]

5. Precisely! And when I can't find them, or if I can find them, and they

don't make good, the government doesn't do it for them.

[marketcrazy1]

6. I got a counterfeit bill from a bank teller once

the bank WOULD NOT take it back..... i think it was a twenty...... was a LONG time ago. ( should have said the bank would not REPLACE IT, they DID take it back and keep it! )

[denem]

7. For Hedge Funds it was like .... Yesterday ;)

[denem]

8. Update Wednesday: Fed buys $300 billion treasuries.

How's that for punditry.