That Didn’t Take Long (Failed Treasury Plan Dept.)

The “super-SIV” bailout fund — which never made much sense, and for which the commitments had been dropping almost daily, is now officially dead before being born: Big Fund to Prop Up Securities Is Scrapped. Its death leaves some egg on the face of the Treasury, which had suggested this was part of the answer to the emerging mortgage crisis.

Note that this is different from the other Treasury scheme to have banks adopt some FICO-score based criteria to allow some fraction of the people who would otherwise default next year to refinance instead (so long as they are up to date on payments, etc. etc.). That band-aid makes some economic sense and may survive, although it's only a few drops in the leaky bucket.

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