Super SIV

Discussion in 'Economics' started by Grandeur, Nov 8, 2007.

  1. November 8, 2007, 12:19 pm

    Bernanke: Merit of Super SIV ‘Depends on the Execution’

    Fed Chairman Ben Bernanke said the Treasury-sponsored effort to create a “Super SIV” could help restore normality to markets but he stopped well short of an endorsement.

    It “all depends on the execution,” he told the Joint Economic Committee. “If it does involve the oversight of investors and a range of financial institutions, then ideally the assets should go into the MLEC [Master Liquidity Enhancement Conduit] at a fair value and at a market value. So … if it works properly I think it would speed up the recognition of values in part because it would remove some of the risk of fire sales, of rapid drawing down of assets in some of these vehicles and allow the market to stabilize and begin to make a better longer term valuation of what these assets are worth.”

    He added, “If that’s the way it works, and again it depends on execution, it would remove some overhang from the market, it would create a stable financing source for those assets and it ought not to be inconsistent with the price discovery process.”
  2. "at a fair value and a market value"

    This might be the funniest thing I have read.