Obama Plan -- Details of Bank Rescue Plan Released -- Finally

March 23, 2009

Today, details of the bank rescue plan were released.  Simultaneously, the stock market surged on this news and what the media is calling an unexpected increase in home sales (nationwide, existing home sales increased 5.1%).  This is the single most significant gain since 2003.

Under the plan, banks will be able to sell their toxic loans in a newly created market.  Right now there is $500 Billion available to purchase these toxic loans, but there can be up to $1 Trillion.

The effect of the plan is that banks will be able to unload these loans into this newly created market which will free up funds for the banks to loan.  When the banks have more to loan, and are making smarter lending decisions, they will become financially stable which helps us all.

Note that I have been writing and saying to anyone that will listen that now is the time to buy or move up.  Conditions are perfect with interest rates still low and home prices back in line with historical norms.  The reason I have been advocating purchasing now is that once the economy starts to improve, many people that can afford to purchase right now will be priced out of the market.

If you snooze, you will lose!