The Fed and US Treasury on Monday said the Fed will provide loans to investors willing to buy toxic “legacy” securities – including risky subprime mortgage-backed securities – under the Treasury’s new plan. But critics including economist and NYT columnist Paul Krugman said the non-recourse government loans would hand private partners large profits if their bets went well, while leaving taxpayers with big losses if the bets went wrong. The FT’s John Authers however says if the Treasury’s plan works, “we may have seen the market’s bottom”.

This entry was posted by Gwen Robinson on Tuesday, March 24th, 2009 at 4:58 and is filed under Capital markets, People. Edit this entry.