Tuesday, March 03, 2009

TALF Scam Launched

The TALF (Term Asset-Backed Securities Loan Facility) is targeted at unlocking the Asset Backed Securities market. The program intends to offer favorable loans to buyers of ABS in hopes of unlocking the credit market. The Federal Reserve believes TALF will clear the way for as much as 1 trillion in new lending.

What Obama and the Federal reserve are not taking into consideration. They are not considering the variables which allowed lending to inflate during the 90's and 2000. Bad burrowers were getting loans to purchase bad properties. Now the bad properties are worthless, literally worthless. Lenders were issuing loans for properties which should have been torn down. Today the assets lenders have on the books are worthless than their tear down costs.
Why, because the homes in the Midwest were not properly winterized and have sustained extensive water damage. These losses have not yet been recorded on banks books. This failure to account for entire losses is intentional and should be considered a fraud to investors.

This crisis is far from over, the aftershocks will have a long lasting effect on the burrowing and lending system. Ignorance is not an excuse, Ben, banks and the Federal reserve are fully aware of these losses. They are just ignoring them in hopes that the market will forgive their intentional error.

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