TALF Is Reworked After Investors Balk - WSJ.com

TALF Is Reworked After Investors Balk - WSJ.com

This subsidized lending program just looks like major league subsidy to the securities industry with layers of transaction costs that incentivize people to trade in potentially irrational way with cheap money and are likely to contribute to TARP assets price inflation . Why not just do market making as I have repeatedly suggested?

The key mistake here is that policy makers seem to confuse
- incentivizing trade on securities with high economic impact which should be the mission of the government here and would lead to a more rational underwriting industry practices going forward
vs
- encouraging the potential reckless issuance of new securities which may in fact perpetuate the practices that led to this mess.

Saturday Night Live - Geithner Cold Open - Video - NBC.com

Dear Mr. Secretary Geithner,
Please , read this:

Fair Value Pricing, Government Market Making and TARP

How to Value Illiquid Toxic Assets clogging up the banking system

Please, please, please

Introduction to BICs

I am making my first post with an introduction to BICs that I have posted on my knol at:http://knol.google.com/k/phil-kongtcheu/introduction-to-basis-instruments/

This article provides a definition for the concept of Basis Instrument Contracts (BICs) and explains why such a concept is needed and useful in Finance, Economics and Mathematics. It explains how BICs are practical and represent both a prophylactic and a therapeutic structural tool for a crisis such as the 2008 crisis. BICs help mitigate market volatility and facilitate more robust risk management.

More about me also at: http://knol.google.com/k/phil-kongtcheu/-/24v2kgtuvzk2v/0#