The Bail Out - Mutual Funds, Pension, Etc

[chinaco]

I was looking at a draft of the bill. I did not see any language that was directly mentioned Pensions, Mutual Funds, etc.

I know that many Bond Mutual Funds, Balanced Mutual Funds, Pensions, etc... must hold those MBS.

Will mutual funds be able to sell those bad assets that they were duped into buying (by the rating agencies)?

 

[OAG]

May be one of the many oversights that are going to come to light as this monster gets dissected over the next few days or weeks. I did not see any mention either directly or indirectly. Maybe they will make some changes in the final product.

 

[ziggy29]

I was looking at a draft of the bill. I did not see any language that was directly mentioned Pensions, Mutual Funds, etc.

I know that many Bond Mutual Funds, Balanced Mutual Funds, Pensions, etc... must hold those MBS.

Will mutual funds be able to sell those bad assets that they were duped into buying (by the rating agencies)?

My question is: If these securities have been getting creamed because of mark-to-market requirements, will the ability to dump bad loans on the feds result in a new "marking" to near par? I'd think that if you hold a security you could dump on the government if it went toxic, the discount to par on those securities in the open market would be fairly small...