참여번역 : 어학사전

다른 번역문 등록

We've got a few more details today from Geithner and the Obama administration about their plan for saving the banks.발음듣기

다른 번역문 등록

So I figured that this is a good time to analyze what they're proposing, and see if we can come to any conclusions.발음듣기

다른 번역문 등록

So, just to simplify the original problem, you have some bank.발음듣기

다른 번역문 등록

Maybe it's Citibank or somebody else.발음듣기

다른 번역문 등록

Let's say they have one big bad asset that they originally paid $100 for.발음듣기

다른 번역문 등록

So that was the original book value for the asset.발음듣기

다른 번역문 등록

And they were able to do that.발음듣기

다른 번역문 등록

And obviously these banks have a bunch of assets, so I'm oversimplifying it.발음듣기

다른 번역문 등록

But I think it'll get you the crux of the issue.발음듣기

다른 번역문 등록

They did that by - obviously a lot of them leveraged much more - but let's say they used $40 of equity.발음듣기

다른 번역문 등록

And then they borrowed the remaining $60 to get that asset.발음듣기

다른 번역문 등록

And now of course, this asset right here is backed by toxic mortgages.발음듣기

다른 번역문 등록

And it's the equity tranche on these mortgages.발음듣기

다른 번역문 등록

And I encourage you to watch the videos on collateralized debt obligations, and mortgage backed securities.발음듣기

다른 번역문 등록

And even the whole thing, all of the videos that we did on Paulson's original bailout plan.발음듣기

다른 번역문 등록

Because I talk about all the liquidity issues there.발음듣기

다른 번역문 등록

The bottom line is that some of these debts are coming due for these banks.발음듣기

다른 번역문 등록

So they need to offload these assets to get cash.발음듣기

다른 번역문 등록

And the whole problem here is, if they offload these assets - let's say they know it's not worth $100, dollars, right?발음듣기

다른 번역문 등록

Everyone knows it's really not worth $100.발음듣기

다른 번역문 등록

But these banks don't want to offload these assets for anything less than $60.발음듣기

다른 번역문 등록

Because if they offload these assets for anything less than $60, then they have negative equity.발음듣기

다른 번역문 등록

That means that the books values here - let's say if that was the only asset they had, then you would have this situation.발음듣기

다른 번역문 등록

If they offloaded for 50 cents on the dollar, then they're offloading it for $50.발음듣기

다른 번역문 등록

So you'd be with this reality.발음듣기

다른 번역문 등록

You would have $50. And you owe $60.발음듣기

다른 번역문 등록

So there's nothing left for the equity, and in fact you would go into bankruptcy.발음듣기

다른 번역문 등록

You would be an insolvent bank.발음듣기

다른 번역문 등록

So just to set the framework.발음듣기

다른 번역문 등록

There's a huge incentive why the bank doesn't want to sell this asset for anything less than 60 cents on the dollar.발음듣기

다른 번역문 등록

The problem is, the most that anyone's willing to pay for it right now is not even the 60 cents on the dollar.발음듣기

다른 번역문 등록

People are just willing to pay - I've read reports and it depends on what asset you're looking at - that people are willing to pay 30 cents.발음듣기

다른 번역문 등록

So let me write that down, because it is important.발음듣기

다른 번역문 등록

This is what banks want. Greater than 60 cents on the dollar.발음듣기

다른 번역문 등록

And in this case, it's $100, so $60.발음듣기

다른 번역문 등록

My understanding is so far, for the most part, without any government intervention, the investors are willing to pay 30 cents or less.발음듣기

다른 번역문 등록

So there's this disconnect. The bank's like, well I'm not willing to sell this for anything less than 60 cents, because then I'm insolvent and the gig's up.발음듣기

다른 번역문 등록

And investors are saying, well these are toxic assets.발음듣기

다른 번역문 등록

Every day there's more foreclosures. It's even hard to get good documentation on what backs up these loans.발음듣기

다른 번역문 등록

A lot of these were these NINJA loans.발음듣기

다른 번역문 등록

No income, no job loans. Or these liar loans, or stated income loans, where people can just fill out with anything they want.발음듣기

다른 번역문 등록

And there's all this fraud. So people are discounting a lot of risk into these assets.발음듣기

다른 번역문 등록

So essentially, the market isn't functioning.발음듣기

다른 번역문 등록

The buyer's willingness to pay is much slower than the seller's willingness to sell.발음듣기

다른 번역문 등록

And nothing happens. And so, these toxic assets are, you could say, clogging up the system.발음듣기

다른 번역문 등록

Because the banks, I won't say that they can't sell them.발음듣기

다른 번역문 등록

It's just they're not willing to sell them.발음듣기

다른 번역문 등록

Because if they were willing to sell them at the market price - whether or not you agree with this market price - the banks will be bankrupt.발음듣기

다른 번역문 등록

So the government all along has been trying to come up with different iterations of how can we somehow get these assets off the banks' balance sheets without causing the banks to get insolvent?발음듣기

다른 번역문 등록

And the original version of TARP 1 is that the government will essentially buy these assets for, who knows, 70 cents on the dollar.발음듣기

다른 번역문 등록

And in that reality, if you bought those assets for 70 cents on the dollar, then those assets, you'd have $70 here.발음듣기

다른 번역문 등록

The bank would owe $60. And there would still be a little bit left of equity.발음듣기

다른 번역문 등록

There would be $10 left. But the important thing is that the bank would be able to pay off its liabilities, stay liquid, and then be around for a better day or a better economy, where it could grow the equity base again by investing in all of that.발음듣기

다른 번역문 등록

And everyone realized that the TARP was a fraud on some level.발음듣기

다른 번역문 등록

Because when you do that, if the market price really is 30 cents on the dollar, and you're paying 70 cents.발음듣기

다른 번역문 등록

Let me say, if this TARP 1.발음듣기

다른 번역문 등록

And the government pays 70 cents on the dollar.발음듣기

다른 번역문 등록

The government's overpaying by 40 cents on the dollar.발음듣기

다른 번역문 등록

In this case, the government would be writing a $40 check to the owners of this company.발음듣기

다른 번역문 등록

In this case, the stockholders. And these are the very same people the management and the original investors in a lot of these companies.발음듣기

다른 번역문 등록

These are the very same people who got us into this mess.발음듣기

다른 번역문 등록

And why should we be rewriting them billions of dollars of checks to essentially just bail them out.발음듣기

다른 번역문 등록

Why don't you just take them into receivership and all that?발음듣기

다른 번역문 등록

And I'll do other videos on that.발음듣기

다른 번역문 등록

So the new iteration that has come about - and let me scroll down a little bit - is, and let me draw the original circumstance.발음듣기

다른 번역문 등록

So you have this item here that was originally paid for $100.발음듣기

다른 번역문 등록

They borrowed $60 to purchase them.발음듣기

다른 번역문 등록

And then they have $40 of equity.발음듣기

다른 번역문 등록

The new plan is, the government's saying, you're right, taxpayer.발음듣기

다른 번역문 등록

We as a government, we're not in a position to decide what things are worth.발음듣기

다른 번역문 등록

We're not hedge fund managers or mutual fund managers.발음듣기

다른 번역문 등록

We're just bureaucrats. And you're right.발음듣기

다른 번역문 등록

We would probably just end up overpaying for things.발음듣기

다른 번역문 등록

Because these guys are smart. And if they're not willing to pay more than 30 cents, and we're paying 70, we're overpaying, and it's just a big subsidy from the taxpayer.발음듣기

다른 번역문 등록

So the new Geithner plan is saying, hey we're going to partner with the private investors.발음듣기

다른 번역문 등록

And the way they're suggesting they do that, is that let's say a private investor - and these are numbers that I've been reading in some of the newspaper reports, and the numbers might change over time because they do tend to.발음듣기

다른 번역문 등록

But private investors will contribute, say, $7.발음듣기

다른 번역문 등록

This is from private investors. The Treasury will contribute another - let me make another box - will kind of match that investment by the private investors.발음듣기

다른 번역문 등록

So the Treasury will contribute another $7.발음듣기

다른 번역문 등록

And then the Fed is going to lend the balance.발음듣기

다른 번역문 등록

So the Fed - let's see, if you want to get to $100, that's $14 - so the Fed has to lend $86.발음듣기

다른 번역문 등록

Let me draw a box here.발음듣기

다른 번역문 등록

It's going to look something like that.발음듣기

다른 번역문 등록

So that's $86. from the Fed.발음듣기

다른 번역문 등록

And of course, this entity, when it's originally capitalized, is going to be sitting on $100 cash.발음듣기

다른 번역문 등록

That's its assets. Well I'm saying it has $100 of cash.발음듣기

다른 번역문 등록

It could be something less, but let's say this is what it originally sets out to be.발음듣기

다른 번역문 등록

Fed lent $86. This is a loan. The Treasury made a direct equity investment of $7.발음듣기

다른 번역문 등록

And private investors make a direct investment of $7.발음듣기

다른 번역문 등록

And then this entity can then go and buy these assets.발음듣기

다른 번역문 등록

And what the government - at least my reading of it is - is that the private investors are going to set the price.발음듣기

다른 번역문 등록

So the private investors are going to say, you know what?발음듣기

다른 번역문 등록

I think that this thing right here is worth, I don't know, I think it's worth 70 cents on the dollar.발음듣기

다른 번역문 등록

And let's say that they are the winning bid.발음듣기

다른 번역문 등록

They are the people willing to pay the most.발음듣기

다른 번역문 등록

Because that's my reading. Is that there will be an auction.발음듣기

다른 번역문 등록

And the private investor, in partnership with the Treasury that's willing to pay the most, will get the assets.발음듣기

다른 번역문 등록

So that in that case - let's say they decide to pay $100, just to make the math easy.발음듣기

다른 번역문 등록

So then this cash will go to this bank.발음듣기

다른 번역문 등록

So then they'll have $100 of cash.발음듣기

다른 번역문 등록

So then we'll have the toxic asset sitting here.발음듣기

다른 번역문 등록

And you might say, hey Sal, that's crazy.발음듣기

다른 번역문 등록

Why would a private investor do that?발음듣기

다른 번역문 등록

And you're right. I mean, in a lot of circumstances, they obviously wouldn't pay.발음듣기

다른 번역문 등록

Actually, because of that, let me not make $100 the number.발음듣기

다른 번역문 등록

Let's say that they pay $60 for it.발음듣기

다른 번역문 등록

Because, remember, the banks weren't even willing to part with them for less than $60.발음듣기

다른 번역문 등록

So for this to even work, someone's going to have to pay at least $60 for this thing.발음듣기

다른 번역문 등록

So let's say they pay $60 for it.발음듣기

다른 번역문 등록

And then they get the asset.발음듣기

다른 번역문 등록

And they're going to have $40 left over.발음듣기

다른 번역문 등록

So they have toxic asset, and then they're going to have $40 left over, because they only paid $60 for the security.발음듣기

다른 번역문 등록

The way I set it up.발음듣기

다른 번역문 등록

Although, they probably designed this thing so there isn't any cash left over.발음듣기

다른 번역문 등록

But let's just use these numbers for the sake of convenience.발음듣기

다른 번역문 등록

So now, you might say, well, this was good.발음듣기

다른 번역문 등록

The private investors, they made an educated decision, and they've decided to price these things at 60 cents on the dollar.발음듣기

다른 번역문 등록

And my question to you is, why would these same people who, before this plan, weren't willing to pay any more than 30 cents on the dollar, now be willing to pay 60 cents on the dollar?발음듣기

다른 번역문 등록

Now they're willing to pay this much for the asset.발음듣기

다른 번역문 등록

And there's a couple of answers here.발음듣기

다른 번역문 등록

I mean, the kind of naive answer is that the government takes the first hit.발음듣기

다른 번역문 등록

Or if these things end up being worth 30 cents on the dollar.발음듣기

다른 번역문 등록

Let's say that we go to some future state, and these really are worth only 30 cents, the most that the private investor loses in this situation is his $7.발음듣기

다른 번역문 등록

The rest of the loss is going to be borne by the Fed and the Treasury.발음듣기

다른 번역문 등록

This loan by the Federal Reserve is a non-recourse loan.발음듣기

다른 번역문 등록

Which means that, if for whatever reason this entity can't pay back the loan, the lender - which is in this case the Fed --can't go after the equity holders.발음듣기

다른 번역문 등록

All the lender can do is take the asset.발음듣기

다른 번역문 등록

So if this asset is worth nothing, the Fed, all it can do is just take the asset, and essentially it's going to get nothing back for its loan.발음듣기

다른 번역문 등록

So in this situation, the private investor would get all of the upside.발음듣기

다른 번역문 등록

If this thing that they paid $60 for ends up being worth, let's say it ends up being worth - I'll draw it down here because it's all going to the equity holder -발음듣기

다른 번역문 등록

if that asset they paid $60 for, it if it ends up being worth $80 then that extra $20 of value is going to be split by the Treasury and the private investor.발음듣기

다른 번역문 등록

So let me give you that situation.발음듣기

다른 번역문 등록

So what would the balance sheet look like?발음듣기

다른 번역문 등록

They pay $60 now. All of a sudden that asset is worth $80.발음듣기

다른 번역문 등록

So this is a good scenario, an upside scenario.발음듣기

다른 번역문 등록

Remember, we had $40 left over in cash, just based on the way I had originally set it up.발음듣기

다른 번역문 등록

You owe $86 to the Fed, the Federal Reserve, which is officially separate from the Treasury, separate entity.발음듣기

다른 번역문 등록

And then the equity is split between the Treasury and the private investor.발음듣기

다른 번역문 등록

So how much equity is there?발음듣기

다른 번역문 등록

You have $120 here minus $86 So you have $34 of equity, right?발음듣기

다른 번역문 등록

Because you have $6 more here, so this is $34 of equity.발음듣기

다른 번역문 등록

And it's going to be split 50-50, so it's going to be $17 for the private investor.발음듣기

다른 번역문 등록

And then you have $17 for the Treasury.발음듣기

다른 번역문 등록

And this looks great. In this situation, the private investor's original investment was $7.발음듣기

다른 번역문 등록

And it went to $17. So it's got a huge return on investment.발음듣기

다른 번역문 등록

So this is the positive scenario.발음듣기

다른 번역문 등록

And then the negative scenario, where let's say that original investment actually ends up being worth $30.발음듣기

다른 번역문 등록

Remember they had $40 of cash in the way I set it up.발음듣기

다른 번역문 등록

Now all of a sudden the Federal Reserve, you had a loan from the Fed for $86.발음듣기

다른 번역문 등록

Now your assets are worth less than your liabilities.발음듣기

다른 번역문 등록

Your equity is wiped out, right?발음듣기

다른 번역문 등록

So in this bad situation, the private investor invested $7, and it went to zero.발음듣기

다른 번역문 등록

So this doesn't actually look like that bad of a scenario.발음듣기

다른 번역문 등록

That in an up case, you go from $7 to $17, And in a bad case, you go from $7 to zero dollars.발음듣기

다른 번역문 등록

And actually, this could be magnified a lot more, depending on how these things work out.발음듣기

다른 번역문 등록

But this still begs the question, if an investor really thinks that these things are worth 30 cents, and that there's no chance that they're worth more than 60 cents, even though they disproportionately can participate in the upside, relative to the downside, which I think in of itself is wrong.발음듣기