Selling these "government guaranteed" CMOs to unsophisticated retail investors was easy because the yield was higher than other "government guaranteed" paper.
Taxable one year U.S. paper is at 1%, give or take, and similar tax-free paper is at 2%! Second, why would anyone buy this when there is a waterfall of U.S. government guaranteed paper coming?
"The reserves are so large that they have little alternative but to hold a substantial fraction in US Treasuries and guaranteed paper," said Richard N. Cooper, an economics professor at Harvard and former undersecretary of state for economic affairs.
"The reserves are so large that they have little alternative but to hold a substantial fraction in U.S. Treasuries and guaranteed paper," said Harvard economist Richard Cooper, referring to the People's Bank of China.
Additionally they receive up to 10-point premiums from guaranteed-paper buyers.
The United States also has agreed to guarantee commercial paper loans in an effort to unfreeze that market.
In addition, early in the crisis, at a time when lending had essentially frozen, the Federal Deposit Insurance Corporation set up an emergency program to guarantee commercial paper loans.
By viewing a BOT contract as a combination of road capacity, toll and government guarantee, this paper investigates optimal concession contract design under both symmetric and asymmetric information about the marginal maintenance cost of private investors.
"I do think that if you ran into a similar situation today the government would guarantee commercial paper again.
A highly interdisciplinary jury numbering diabetologists and members of other healthcare professions dedicated to diabetes care and lay members was created to guarantee the paper's best applicative efficacy.
Reputation, he said, is far more important than any guarantees on paper.
