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...purchases by private investors - is a great deal for the investors and a big risk for the taxpayers. The math calls for the government to take on most of the downside risk while evenly sharing the rewards with hedge funds, money managers and other buyers. In the loan-buying program, private investors would put up 7% of the capital for a shot at close to 50% of the gains. The ratio in the securities-buying program isn't entirely set yet and will probably vary, but it should offer a similarly favorable risk-reward profile. (See 25 people to blame...

Author: /time Magazine | Title: Separating Toxic Assets from Legacy Assets | 3/26/2009 | See Source »

...mark some of their assets to market prices because the markets for many debt securities are so clearly broken. But the prices prevailing in a smoothly functioning government-subsidized market will be hard to ignore. This has led to speculation in the economics blogosphere that banks might game the program by conniving with investors to overbid for assets. That's not inconceivable, but it would be hard to pull off. Which means banks may be headed for a shakeout...

Author: /time Magazine | Title: Separating Toxic Assets from Legacy Assets | 3/26/2009 | See Source »

...dispute may be in sight, though. Obama's Transportation Secretary, Ray LaHood, met with U.S. lawmakers Tuesday, saying he planned to restart the pilot program with sufficient safety requirements imposed on Mexican truckers. Though key American Representatives have yet to sign on to LaHood's initiative, Ruiz said the same day that Mexico would remove the tariffs to reciprocate if the program were reinstituted. "For us, the solution is to go on with the program that we had," he said. "In the moment the United States returns to its commitments, we will eliminate all the tariffs we imposed." Clinton...

Author: /time Magazine | Title: Obama's 'Trade War': No Truck with Mexico | 3/25/2009 | See Source »

...Which makes the European Union's March 20 decision to include Belarus in its "Eastern Partnership" initiative all the more surprising. The program foresees deeper political and economic ties between Brussels and six former Soviet states: Armenia, Azerbaijan, Belarus, Georgia, Moldova and Ukraine. Closer ties, Europe hopes, will promote democracy and better human rights. (See pictures of the 2006 riots in Minsk...

Author: /time Magazine | Title: Belarus: Can Europe Change Its 'Last Dictatorship'? | 3/25/2009 | See Source »

...vote followed accusations that one of Topolanek's aides had tried to pressure the Czech public television broadcaster to drop a program criticizing a former member of the opposition Social Democrats who had decided to back the coalition. But the toppling of Topolanek is not just a Czech issue. With the Czechs currently holding the presidency of the European Union, the consequences of this vote could resound far beyond Prague and deep into Brussels. (See pictures of Prague...

Author: /time Magazine | Title: Czech Government's Collapse Hits the E.U. | 3/25/2009 | See Source »

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