Would you buy mortgages from the FDIC? Okay, so what caused the panic last year was when people who had bought “securitized” mortgages realized many were either fraudulent or owed by people who no longer had the ability to pay and/or had no equity left and walked away.
So now the FDIC has decided that the way to fix its financial problems and avoid surrending to Tim Geithner’s waiting arms… is to take all of the crap loans (about $30 billion worth) they’ve acquired by taking over failed banks and putting them in FDIC securitized mortgage investments to sell to other people. Who would be stupid enough to buy those (other than the Federal Reserve, that is)? I”m sure Goldman Sachs would be glad to sell them if they can have a commission and none of the risk
