The NY Post reports -
As Treasury Secretary Tim Geithner orchestrated a plan to help the nation's largest banks purge themselves of toxic mortgage assets, Citigroup and Bank of America have been aggressively scooping up those same securities in the secondary market, sources told The Post.
[snip]
Recently, [these securities] have changed hands for roughly 30 cents on the dollar, and most of the buyers have been hedge funds acting opportunistically on a bet that prices will rise over time. However, sources said Citi and BofA have trumped those bids.
In other words - Citi and BofA are outbidding people to buy more of the same toxic assets they have been begging Washington to take off their hands.
I'm sure smarter people than me have a better idea of why this is so - but the simplistic cynic I am - I'm wondering if they expect to be able to sell these new assets (to us) for more than they are currently paying for them.
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