What bank in their right mind is going to take that bet? They’d be gambling that when the government defaults, we wouldn’t have some ass-clown in office with a penchant for welching on contracts.
This is exactly the plan. Last week the GSA put out a list of 400 federal buildings they wanted to sell, a list that included buildings like the FBI headquarters. They want to sell these building to private owners then make up any shortfalls in space with leases from them.
The problem is there’s a very real risk the American people will view the move as illegitimate and prevent the land from being taken in the future, ie under a new admin that jails trump or something. The point of collateral is to reduce risks, not introduce new and exciting ones. Nobody is going to accept lower rates on this unless the aforementioned quid pro quo is real, in which case the deal is already illegal and the downside risks now include prison.
Yes this is idealistic, but the threat is still real and that’s how finance people calculate interest.
If we had an opposition party that wasn’t comatose, it would be announcing that any debt purchased under this scheme would not be honored once Trump is out of office.
What bank in their right mind is going to take that bet? They’d be gambling that when the government defaults, we wouldn’t have some ass-clown in office with a penchant for welching on contracts.
You’re looking at it backwards:
They’re going to give public lands to themselves and their friends with this mechanism.
This is exactly the plan. Last week the GSA put out a list of 400 federal buildings they wanted to sell, a list that included buildings like the FBI headquarters. They want to sell these building to private owners then make up any shortfalls in space with leases from them.
The problem is there’s a very real risk the American people will view the move as illegitimate and prevent the land from being taken in the future, ie under a new admin that jails trump or something. The point of collateral is to reduce risks, not introduce new and exciting ones. Nobody is going to accept lower rates on this unless the aforementioned quid pro quo is real, in which case the deal is already illegal and the downside risks now include prison.
Yes this is idealistic, but the threat is still real and that’s how finance people calculate interest.
If we had an opposition party that wasn’t comatose, it would be announcing that any debt purchased under this scheme would not be honored once Trump is out of office.