Thursday, August 5, 2010

Mortgage Workout 2: Funding

FUNDING for this Program: No new taxes.

Congress will authorize Treasury to issue up to $800 billion in 30 year Treasury bonds, at prevailing rates, to implement this program; or the balance of uncommitted TARP funds be used to reduce the amount of extra funding required until $800 billion is allocated to the Federal Reserve Banks for this purpose.

These funds will be placed in a separate segregated Federal Reserve Board administered fund that cannot be invaded by Congress. These funds will be used to purchase mortgages funded by Freddie Mac/Fannie Mae/Federal reserve Banks.

Chairman of Fed to be responsible for disbursement and oversight of the program through FNMA/FHLMC/Federal reserve banks so co-ordination with Monetary policy will be maximized.

Reporting to Congress on program status twice a year.

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