Sunday, August 24, 2008

GSE's: Read the fine print

“(C) CONSIDERATIONS — To protect the taxpayers, the Secretary of the Treasury shall take into consideration the following in connection with exercising the authority contained in this paragraph:

“(i) The need for preferences or priorities regarding payments to the Government.

“(ii) Limits on maturity or disposition of obligations or securities to be purchased.

“(iii) The corporation’s plan for the orderly resumption of private market funding or capital market access.

“(iv) The probability of the corporation fulfilling the terms of any such obligation or other security, including repayment.

“(v) The need to maintain the corporation’s status as a private shareholder-owned company.

“(vi) Restrictions on the use of corporation resources, including limitations on the payment of dividends and executive compensation and any such other terms and conditions as appropriate for those purposes.

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