But while banks in theory have discretion over whether to sell loans,
Sheila Bair, chairman of the Federal Deposit Insurance Corporation,
said this decision would be made "in consultation with regulators" – a
sign that the authorities might put pressure on banks to sell toxic
assets.
Here is the full article.
Add this to the Depression Watch Department as well.
http://news.yahoo.com/s/nm/20090325/us_nm/us_fedex_orders
shouldn’t somebody put pressure on these banks to do something? the management and stockholders of these institutions seem to be just sitting there, sulking. one can argue for or against any particular government authority and regulation in this arena, but we are past the time of hand-wringing over the question of new governmental authority for the foreseeable future.
that’s not quite right gc. the problem with so called toxic assets is not that the value is low. it’s that on one hand a lot depends on the market value (ie decisions about the solvency of major banks depend on the values of these) and on the other hand there is little or no liquidity in the market so people do not have confidence in the prices in the market. it’s one reason why we are not able to find a clear path through this mess.
there are plenty of assets that everyone believes are worthless or nearly worthless as well. those aren’t toxic at this point; they are merely worthless.
Wait a second, what is it exactly that’s gotten better since January?
Banks don’t want to sell MBSs at market-clearing prices, which is why they’re still holding them.
Then the prices in question can’t really be called “market-clearing,” can they?
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