On p.A4 of today’s WSJ, Deborah Solomon and Jon Hilsenrath report more detail on the Treasury’s “Bad Bank” funding plan. On first (and third) read I’m not impressed, but we’ll go through all the available details and report back later.For now, I just have one question. Isn’t this essentially the same plan that Goldman Sachs has been shopping around for the past month or so? There’s nothing necessarily wrong with that, of course. But it would be a huge win for Goldman and Lloyd Blankfein – explaining, for example, the confidence displayed in his recent FT article.
And, whatever the reality of lobbying, pressure, and idea exchange here, the optics (as they say in the message spinning business) don’t look great.
Originally published at the Baseline Scenario and reproduced here with the author’s permission.