By Brian Beutler
Vikas Bajaj and Stephen Labaton report:
As the Obama administration prepares its strategy to rescue the nation’s banks by buying or guaranteeing troubled assets on their books, it confronts one central problem: How should they be valued?
Not just billions, but hundreds of billions of taxpayer dollars are at stake.
If there were an easy way to do it, I’d say that each bank’s toxic assets should be priced such that, once the government buys them, they become solvent by $0.01. Absent that, though, I feel as though there’s this other option out there that people like to talk about on the Internet and in Scandinavia, but that’s been rejected out of hand by both the previous administration and the current one…