They’ve come to an agreement!!

September 28, 2008 – 2:23 am – No Comment

Just after midnight Congressional leaders and members of the Bush administration came to a tentative deal on the bailout. Nancy Pelosi even said all that had to be done was for the agreement to be put on paper. Even treasury secretary Paulson said that a deal had been reached.

One of the most controversial points made in the bailout is the inclusion of the limits on severance packages available to executives that would benefit from the bailout plan.

According to the plan, the Treasury Dept. will buy bad mortgage backed securities and other forms of bad debts that banks and investors hold. Some of the money would also be given to a program that would encourage some of the holders of troubled mortgage backed securities to keep the securities and instead buy insurance from the government to cover the defaults.

Also, to help the actual homeowners that are facing foreclosure, the bailout requires the government to try to renegotiate their mortgages to attempt to lower their monthly payments, so maybe they can keep their homes.

Overall it doesn’t seem so bad, however I believe we need more regulation of the markets to keep something like this from happening again.