The Conservative Cave
Current Events => Breaking News => Topic started by: Chris on September 30, 2008, 10:30:15 PM
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GOP Members Forging Alternative Bailout Plan (http://www.cnbc.com/id/26962690)
Components of the alternative plan including the following, according to sources:
- Require the Treasury Department to guarantee, at up to 100 percent, bank losses resulting from failed mortgage-backed securities originated prior to the plan's enactment. Such insurance, supporters say, would provide immediate value to the securities and a foundation for which they could then be sold. The Treasury Department would finance that insurance by assessing a premium on outstanding mortgage-backed securities.
- Allow companies to carry back losses arising in tax years ending in 2007, 2008, or 2009 back five years, generating a tax refund and immediate capital
- Allow a "repatriation window" for profits earned by U.S. firms overseas. Such repatriation amounts would not be taxed if invested in distressed debt (as defined by Treasury) for at least one year.
- Allow banks to treat losses on shares of preferred stock in Fannie Mae and Freddie Mac as ordinary losses, not as capital losses
- Suspend the capital gains tax rate for two years
- Limit backing of high-risk loans by Fannie Mae and Freddie Mac
- Schedule Fannie and Freddie for privatization
- Suspend "mark-to-market" accounting until the SEC can issue new guidelines that will allow firms to mark these assets to their true economic value
- Stabilize the dollar by repealing the Humphrey-Hawkins Full Employment Act, which alternative bailout supporters say diverts the Federal Reserve's attention from long-term price stability to short-term economic growth
- Require the Treasury to write rules prohibiting excessive compensation or golden parachutes to executives of failed companies
- Task the SEC with regular, annual audit reports of entities the federal government has brought under conservatorship or now owns
http://www.cnbc.com/id/26962690