Guy on Internet predicts economic depression

Trillions on guns, trillions to the banks - who the hell's footing the bill on this one? Oh yeah - us!
Take student loans as collateral, firms tell Fed
Mon Apr 7, 2008 5:17pm EDT

WASHINGTON, April 7 (Reuters) - The financial services industry has urged the Federal Reserve to accept as collateral triple-A rated student loan asset-backed securities as collateral for firms seeking to borrow from new Fed facilities aimed at thawing frozen credit markets.

The American Securitization Forum and the Securities Industry and Financial Markets Association wrote Fed Chairman Ben Bernanke and New York Fed President Timothy Geithner on April 2, saying those securities are safe and should be among those financial firms can pledge to borrow from the central bank.

"Given the very limited credit risk inherent in triple-A rated government guaranteed and private (student loan asset-backed securities), we believe this proposal appropriately balances managing federal government risk exposure and meeting with urgent need for additional sources of liquidity to help fund student loan originations," the industry groups' senior officials wrote.

As risk-wary investors have pulled back from lending in the wake of the subprime mortgage debacle, the Fed has recently launched several new facilities to provide banks and other financial firms assured sources of funding.
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