Monday Meltdown May Be Averted?

It seems to have measures desired by the Right and The Left,  and hopefully,  enough meat to assuage fears on the market to avoid a crash this coming week. 

The plan calls for the Treasury Department to buy deeply distressed mortgage-backed securities and other bad debts held by banks and other investors. The money should help troubled lenders make new loans and keep credit lines open. The government would later try to sell the discounted loan packages at the best possible price.

At the insistence of House Republicans, some money would be devoted to a program that would encourage holders of distressed mortgage-backed securities to keep them and buy government insurance to cover defaults.

The legislation would place limits on severance packages for executives of companies that benefit from the rescue plan, but details were sketchy.

Also, the government would receive stock warrants in return for the bailout relief, giving taxpayers a chance to share in financial companies’ future profits.

To help struggling homeowners, the plan requires the government to try renegotiating the bad mortgages it acquires with the aim of lowering borrowers’ monthly payments so they can keep their homes.

The measure’s main elements were proposed a week ago by the Bush administration, with Paulson heading efforts to push it through the Democratic-controlled Congress. Democrats insisted on greater congressional oversight, more taxpayer protections, help for homeowners facing possible foreclosure, and restrictions on executives’ compensation.

To some degree, all those items were added.

Talking Points Memo | Deal reached on financial markets bailout

 

The bolded points are the key I have been stressing (not that I am in any sense of the word,  an economically knowledgeable guy.  It just seems to me that oversight is important to keep an eye on things.

About Theoblogical

I am a Web developer with a background in theology, sociology and communications. I love to read, watch movies, sports, and am looking for authentic church.

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