What's Behind Geithner's Threat

Read this new analysis of the banking situation by Goldman Sachs. It mentions that banks will need some encouragement to sell the so-called toxic assets. I think Geithner is giving them some with his threat to replace executives:

First, it’s unclear whether Treasury and the FDIC will persuade enough investors to participate and enough banks to sell.  On the investor side, note that the Treasury has just extended the application deadline for the securities portion of the program.   (This refers to the securities portion rather than the more important loan portion)  On the banks side, we continue to think that the that the bid prices will still be well below the banks’ current marks, at least for whole loans held to maturity, so banks will need some encouragement to sell. 

Reader Comments Read all comments (2)

Add Your Thoughts

Comment Name State Select One AL AK AZ AR CA CO CT DE DC FL GA HI ID IL IN IA KS KY LA ME MD MA MI MN MS MO MT NE NV NH NJ NM NY NC ND OH OK OR PA RI SC SD TN TX UT VT VA WA WV WI WY International Email

Please enter the two words below into the text field underneath the image.

Incorrect please try again

Enter the words above: Enter the numbers you hear:

Your comment will be posted immediately, unless it is spam or contains profanity. For more information, please see our Comments FAQ.