Comments on: Redirection of Liquidity, Not Creation of Liquidity http://alephblog.com/2008/03/11/redirection-of-liquidity-not-creation-of-liquidity/ Helping Institutions and Ordinary People Invest Better by Focusing on Risk Control Mon, 13 Feb 2012 14:34:49 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Alan Matthews The Dean of Dracuthttp://alephblog.com/2008/03/11/redirection-of-liquidity-not-creation-of-liquidity/comment-page-1/#comment-17287 Alan Matthews The Dean of Dracut Wed, 19 Mar 2008 01:10:42 +0000 http://alephblog.com/2008/03/11/redirection-of-liquidity-not-creation-of-liquidity/#comment-17287 This is a wind up that will unwind like a tornado with massive devistation all around. This is not physic class where one can freeze water and then thaw it. We hane had a temporary thaw with the foolish move of lowering the fed rate 75 basis. We are near the end of the rope with little to hold onto. what is the next move? Dollar that 50 cents and a rate of zero???? How does this redirection help me? My mortage is a 20 year fixed at at 5.25. This does not put any money in my pocket. It does not lower over charged credit card holders with 21% rates. It helps the ultra rich get richer as the government opened up a yield spread. Those hedging on this made huge money today. The government need to shut this all down now!! They need to take direct action not indirect action. Fund Fannie Mae as Jim Crammer wants although I do not agree with him as this is my hard earned moey paid in taxes with my blood and my sweat. Correct the foreclosure situation and let the rest sort itself out. The real issue is loss of homes not loss of finicial institutions. Does anyone care the Bank of New England is gone? No. They were liquidated in the 80's for foolish loans. The real issue is home loss. MBS need to be fixed and fixed now. This is a wind up that will unwind like a tornado with massive devistation all around. This is not physic class where one can freeze water and then thaw it. We hane had a temporary thaw with the foolish move of lowering the fed rate 75 basis. We are near the end of the rope with little to hold onto. what is the next move? Dollar that 50 cents and a rate of zero????
How does this redirection help me? My mortage is a 20 year fixed at at 5.25. This does not put any money in my pocket. It does not lower over charged credit card holders with 21% rates. It helps the ultra rich get richer as the government opened up a yield spread. Those hedging on this made huge money today. The government need to shut this all down now!! They need to take direct action not indirect action. Fund Fannie Mae as Jim Crammer wants although I do not agree with him as this is my hard earned moey paid in taxes with my blood and my sweat. Correct the foreclosure situation and let the rest sort itself out. The real issue is loss of homes not loss of finicial institutions. Does anyone care the Bank of New England is gone? No. They were liquidated in the 80′s for foolish loans. The real issue is home loss. MBS need to be fixed and fixed now.

]]> By: Jeffhttp://alephblog.com/2008/03/11/redirection-of-liquidity-not-creation-of-liquidity/comment-page-1/#comment-17212 Jeff Wed, 12 Mar 2008 04:59:48 +0000 http://alephblog.com/2008/03/11/redirection-of-liquidity-not-creation-of-liquidity/#comment-17212 David - They are going to keep this facility going as long as necessary. They will increase it if needed. They may actually buy assets. This provides an alternative approach to more aggressive rate cuts. They are attempting to stop the death spiral resulting from FAS 157 mark to market prices -- a good idea that makes little sense when there is forced selling into illiquid markets. What they are doing seems responsive to your past criticisms. David – They are going to keep this facility going as long as necessary. They will increase it if needed. They may actually buy assets.

This provides an alternative approach to more aggressive rate cuts. They are attempting to stop the death spiral resulting from FAS 157 mark to market prices — a good idea that makes little sense when there is forced selling into illiquid markets.

What they are doing seems responsive to your past criticisms.

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