Bailout WTF?
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A quick one, we’re running out the door: Pimco’s influential bond guru, Bill Gross, gives a full-throated endorsement to a homeowner bailout this morning. We believe this will embolden many Democrats -- and some Republicans -- to call for government aid to homeowners.
Gross: ‘Why is is possible to rescue corrupt S&L buccaneers in the early 1990s and provide guidance to levered Wall Street investment bankers during the 1998 LTCM crisis, yet throw 2,000,000 homeowners to the wolves in 2007? If we can bail out Chrysler, why can’t we support the American homeowner?’
More Gross: ‘Get with it Mr. President and Mr. Treasury Secretary ... .create an RMC -- Reconstruction Mortgage Corporation. ... Write some checks, bail ‘em out, prevent a destructive housing deflation that Ben Bernanke is unable to do.’
To those who disagree and will ask, ‘who gives a damn what a bond billionaire says,’ we would say, Gross is the kind of commentator who has influence in policy circles. Perhaps not with the White House, but with other politicians at the state and federal level. You may disagree with him, but he is important.
Thoughts? Comments? Insights?
Hat tip: Seek Up xxx (you know your number)