The FDIC Tries to Unload Its Crap Assets
No no no, FDIC, apparently no one told you, there is a line and somehow you are at the end of it.
The U.S. Federal Deposit Insurance Corp is planning to sell $1.8 billion of guaranteed asset-backed debt, according to IFR, in what may be a step toward restoring confidence in securities closely tied to the financial meltdown.
The debt will be backed by residential mortgage assets of failed banks seized by the FDIC, market sources said. The two-part deal is expected to sell this week via Barclays Capital, said IFR, a Thomson Reuters service.
The move has been anticipated by investors and dealers for months as the FDIC piles up loans from banks failing at an alarming rate. The plan calls up memories of the savings and loan crisis of the early 1990s when the federal government created the Resolution Trust Corp to dispose of assets.
It could also awaken a market that has been largely frozen for two years, except for government-sponsored programs of Fannie Mae and Freddie Mac. While the FDIC bonds are expected to also carry a government stamp, their origination via Wall Street suggests a stepping stone toward the kinds of private issuance seen crucial if U.S. housing is to wean itself from government support, analysts said.
Apparently no one informed Sheila Bair that the CFPA is dead so she can stop pushing it now. Surely she of all people understands that the consumer really needs protection from itself more than anything else but so long as agencies like hers swoop in to "save the day", nothing changes. A little panic. A quick ride. And back to the teevee and a fake vacation that you take just because the neighbors are too.
This one is for you, Sheila: