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Stock futures are up after the Federal Reserve announced two big plans in hopes of unfreezing consumer credit. One is a $600 billion program to buy mortgage-related debt, of which the Fed says, "This action is being taken to reduce the cost and increase the availability of credit for the purchase of houses, which in turn should support housing markets and foster improved conditions in financial markets more generally." The other is a $200 billion effort to back consumer loans, like student, auto, and credit card loans; the Fed says it stepped in because "Continued disruption of these markets could significantly limit the availability of credit to households and small businesses and thereby contribute to further weakening of U.S. economic activity."
Fed Unveils $800 Billion Plans to Buy Mortgage, Consumer Debt
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This is why they already spent $350 billion on banks and it was a disaster.(Bank of America took its $25 billion and bought 19% of a chinese bank, for example)Now comes this direct interjection. Capitalism is dead. Long live "Capitalism".
I sort of like this whole deal. for whtever reason, I'm breathing better right now! yes, i'm a broker, yes, i have been struggling, yes, I hold a mortgage, yes, ive lost tons in the market already...but yes, I like this idea.
If you picked out 100 random mental patients from Bellevue, they'd do a better job of running the country or any of the major corporation.
Throw more money at it. That's always the answer.
Hey, they can buy off my mortgage, I'll volunteer!
give them bailout money then pay off their customers debts. what does that equal? double bailout for the banks. just help customers get out of debt and those banks wouldnt require their initial bailout.
What's that $200B for consumer debt going to do for me?
(Nothing, I assume, but it can't hurt to ask.)
JMH: if you aren't effected directly by the mortgage, banking, insurance, financial boondoogle then you should consider yourself pretty lucky. This will generate money back to the banks (albeit double if you give some to the cnsumer to pay back their debts), get everyone back on their feet again, and generate some life to the economy.