As Fed Chairman Ben Bernanke famously said, the Fed could always stimulate the economy by printing money and dropping it out of helicopters, but it will do everything in its power to avoid using the "helicopter option." Sounds like Pepean economics to me. Let's do it!
The Treasury is paying just 0.30% interest for the first $40 billion, but AIG will pay much more than that if it taps the Fed for a loan: At Wednesday's rates, AIG would pay 11.53% interest back to the government. A tidy profit. Not bad. But what if AIG goes belly up? Who's left holding the bag?
Wednesday, September 17, 2008
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1 comment:
A heckuva job.
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