Supposedly there is a bill floating throught Congress that would extend TARP financing to real estate properties, both commercial and residential large properties. http://www.nypost.com/seven/08132009/business/apts_to_rent__2b_184293.htm Who is now supposed to pay for this if funds don't get returned? Are the traders still on the hook for this now? Or will they introduce a "lease tax" on all new leases to pay for any short falls? Why do I get the feeling that over time it will be the Financial Industry (read: the traders) who will end up getting screwed for this monstrosity of a program? BTW, it is sponsored by Barney Frank. What are the odds?
why don't they just liquidate and auction the property if nobody wants it. why does the taxpayer have to buy overpriced real estate from real estate moguls who overleverage and overpaid in their real estate private investments. these real estate investors were making a killing in profits. in 2005-2007 flipping real estate..they are asking too much for their property that nobody wants. tarp is like "CORPORATE WELFARE" this will in history books as corporate welfare, gov't handout to the rich. small business and students loans getting nothing for CIT going bankrupt.. there were like tonnes of buyers of real etate in a real estate auction but these sellers have a 'reserve' price on it. or minimum bid price. etc on it. the ultimate stimulus for residential real estate or anyting is 'cheap' prices....people will buy with money on sidelines or get loans if it's cheap and good value. than after all the cheap inventory is sold the bull market comes back. the buyer gets a good deal and the seller gets cash and use the cash to buy something else...economic stimulus if buyer and seller doesn't agree on price,,,no transaction and you have recessions. cash isn't ciruculating. homes were in the market for 1 to 2 years unsold. the cheaper the price the more volume. it is simple concept in economics 101 same for equities , if the p/e were like 8 there would be stampede to the market to buy cash from sidelines start coming back and you've got stimulus withou any gov't support. wall street or owners of equities gets it's cash and spends on something else.. economic business cycle complete. no debt to the gov't or cost to taxpayer