Redistribution through the Geithner Plan
Appropriate policies to address the problem of toxic assets should act as automatic stabilizers, so that institutions who toxic assets turn out to be worthless receive more public support than institutions whose toxic assets have value. Furthermore, such policies should be frugal in their demands on the taxpayer. In the context of a simple illustrative toxic asset, the paper shows that the Geithner Plan fulfills neither of these desiderata. The plan is extremely wasteful when banks need only modest bailouts; when they need large bailouts, the plan is ineffective.
|Date of creation:||2009|
|Date of revision:|
|Contact details of provider:|| Postal: Kiellinie 66, D-24105 Kiel|
Phone: +49 431 8814-1
Fax: +49 431 8814528
Web page: http://www.ifw-kiel.de/
More information through EDIRC
When requesting a correction, please mention this item's handle: RePEc:zbw:ifwkie:32968. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (ZBW - German National Library of Economics)
If references are entirely missing, you can add them using this form.