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Bofa Now Offering $2bn Autoloan Bundle Through Talf

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http://ftalphaville.ft.com/blog/2009/08/27...-2bn-talf-deal/

BofA offers $2bn TALF deal

Posted by Gwen Robinson on Aug 27 05:09.

Bank of America/Merrill Lynch is in the market with a $2bn auto loan-backed deal which is eligible for the Federal Reserve’s TALF scheme through which investors can procure cheap loans to buy consumer loan-backed and new and existing commercial mortgage-backed bonds, reports the WSJ. BofA’s deal, dubbed BAAT 2009-2, is jointly led by BofA/Merrill Lynch, Barclays Capital, Citi, Credit Suisse and RBS; it follows BofA’s first TALF-related deal last month in which it sold a $3.9bn auto-loan backed deal at 135bp over the benchmark.

Let's get this straight. The US Federal Government stimulates the economy by offering cash for clunkers and gees up the commercial banks to issue auto loans.

Fearful that this is a fake, unsustainable invitation to the US consumer to take on even more debt, the commercial banks now issue bonds, made up of said auto loans, back to international investors under government protection.

What picture does this paint? A seriously convoluted attempt to push US debt on the rest of the world, no matter what?

The US is broke and bankrupt to the tune of at least $2 trillion folks, plain and simple.

Edited by AvidFan

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