Let Taxpayers Profit From The Bailout

Others have argued that the government purchase of mortgages bonds at distressed levels could turn into a financial bonanza.

From Andy kessler at the Wall Street Journal:

My analysis suggests that Treasury Secretary Henry Paulson (a former investment banker, no less, not a trader) may pull off the mother of all trades, which could net a trillion dollars and maybe as much as $2.2 trillion -- yes, with a "t" -- for the United States Treasury.

Andy Kessler is a former hedge fund manager, the ones who know how to profit from buying and selling distressed securities.


The question is: who's going to get the profits?

Democrats would like the people responsible for this mess profit. Organizations like ACORN, the corrupt advocacy group.

Or they will spend it on their next boondoggle.

How about making the American taxpayers the ones that will profit. It is, after all their money.

Here’s how it can be done.

Create a “Reconstruction Finance Corporation.” (RFC)

Give every American taxpayer equal shares of the RFC.

The treasury loans the RFC $700 million dollars.

The RFC buys the distressed debt for bargain basement prices (the holders will be glad to sell to get it off their books.)

The RFC hold the bonds until the real estate market rights itself.

When the true value of the mortgage bonds are established the FRC can sell the bonds to interested parties.

The treasury gets it loan back.

Profits from the sale are distributed to shareholders (those taxpayers who got their shares) as dividends. I want my part of the $2 trillion profit.