The big banks are lobbying the FDIC for another handout, with their "Legacy Loan" portfolios.
http://online.wsj.com/article/SB124338836675757049.html#mod=testMod
In a nutshell, the banks, now want to purchase their own bad loans, instead of doing a daisy chain, by purchasing other banks marked down bad loans, while selling them theirs.
Their argument?
They'll be inclined to sell some loans at a loss, if they can share in the upside of the loans they are purchasing, especially if they are getting government financing.
Especially, since they know which loans they are selling!
It's the JPMorgan/WaMu plan. Mark down the assets to sell them, and then mark then up when they find the loans aren't as bad as they think.
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