The Top 10 Ways to Deal with Toxic Assets
By Nicole Ibbotson and Kevin Petrasic
The recent re-branding of the Troubled Asset Relief Program (TARP) as the Financial Stability Plan (FSP) by Treasury Secretary Timothy Geithner and his subsequent roll-out of the FSP outline and, more recently, the Capital Assistance Plan (CAP) has done little to stem the fallout of the ongoing financial crisis. Rather than having a stabilizing effect, the lack of meaningful detail and transparency has appeared further to roil the markets. The reason, of course, is the bad assets still there hanging like a weight on the neck of the American economy. While criticism focused on the lack of detail and direction in the FSP and a confusing rationale for the CAP, the main issue remains: there still exists a lack of consensus among industry experts on how to remove toxic assets off banks existing balance sheets.