Tuesday, February 23, 2010

If this is happening, the Administration is Pretty Clever

I heard a real estate investor this morning claim that as banks are making profits because of the spreads over their cost of money, regulators are forcing them to liquidate bad assets and realize the losses. If this is really going on, somebody really smart is behind the idea.

2 comments:

Casey said...

Can you please elaborate on this for those of us who aren't economists? How is this really smart?

Pete DZ said...

Because it's the opposite of what happened in Japan. Loss realisation means the deleveraging actually happens.