2/26/2009

Peter J. Wallison, a senior fellow at the American Enterprise Institute, says that there is a solution to the problem of pricing toxic bank assets. "Both taxpayers and banks could come out well -- and so would our economy -- if the government were to buy the assets at their 'net realizable value,' which is based on an assessment of their current cash flows, discounted by their expected credit losses over time." Wallison explains how this would work and suggests that Treasury Secretary Timothy Geithner consider such a plan.

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