This week the very first PPIP (remember that?) pilot program was launched. Under the plan, Residential Credit Solutions managed to buy $1.3 billion worth of toxic loans from the failed Franklin Bank, while only having to put down $64 million. The rest comes from taxpayer-guaranteed leverage. Mike Konczal at Rortybomb put together this chart, which spells it out pretty clearly. If the assets decline in value, you, the taxpayer, are on the hook. If they go up, you only split half the profits.
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