Editor’s Note: The following report is excerpted from Jerome Corsi’s Red Alert, the premium online newsletter published by the current No. 1 best-selling author, WND staff writer and columnist. Subscriptions are $99 a year or $9.95 per month for credit card users. Annual subscribers will receive a free autographed copy of “The Obama Nation,” the blueprint for Obama’s first term in office.
The Obama administration, with the support of some top Republican senators, appears to be moving toward nationalizing U.S. banks, in a strategy known as the “Swedish Plan,” Jerome Corsi’s Red Alert reports. The strategy was heavily championed by George Soros at the Economic World Forum held in Davos, Switzerland, earlier this year.
In the early 1990s, Sweden nationalized banks, but only after the banks had taken the losses writing down their own troubled losses.
Economists Christopher Wood argued in a Financial Times column that the U.S. Troubled Assets Relief Program, or TARP, has failed to follow the Swedish model. He wrote that the U.S. government has poured $700 billion of bailouts to banks and brokerage firms without requiring the institutions to first to write down their bad assets and without the government taking majority control.
“Should the Obama administration choose to implement the Swedish plan as a solution to the bank meltdown over toxic assets, the change in direction would effectively limit the continuance of the Troubled Asset Relief Program, or TARP,” Corsi wrote.
TARP was predicated on the idea that the government could bail out banks by issuing loans to provide liquidity so they would continue extending credit. Under TARP, the banks were expected to write down, sell or otherwise work out toxic assets that were based on mortgages or other forms of securities derived from debt products, including student loans or credit cards.
“The decision to move from a TARP bailout to a bank nationalization approach largely reflects a growing government realization that troubled bank assets may well amount to trillions of dollars, instead of the more limited $700 billion Congress had provided in the two tranches of TARP bailout funds,” Corsi wrote. Continue reading . . .
