if that's the case, the whole nation could just retire, and let Paulson and the 700 billion work it's magic.

Paulson made a huge mistake when he sit infront of congressmen and senators and said the banks need help , etcc.
Know the banks are sitting on the money , and they aren't helping "small companies borrow money " he's to worried about Banks , and the hell with everyone else .
He's not even worried about citizens / taxpayers who needs the money too , if it wasn't for the mortgage companies , and many other larger companies , we all wouldnt be in this horrible mess . Look at AIG , they asked for more money $100 billion plus , and they end up going on there luxury vacations , giving CEO's bonuses , so much more stuff that went on . CEO's mismanage the companies right along with other companies , know they want the taxpayers to bail them out . Taxpayers pay for it , and what do they get out of it ? NOTHING .
Mortgages are the ones who screwed the homeowners up in the right place , know the homeowners are losing there homes and jobs because they were lied too and companies mismanage put the money in there CEO's pocket . If the mortgage companies managed there money right , the homeowners still living in there homes.
BUSH DIDNT HELP THIS COUNTRY AT ALL , IN THOSE 8 YEARS , HE'S THE WORSE PRESIDENT IN HISTORY .
AS FAR AS OBAMA , I PROMISE HE WILL BE WATCHED OVER , 24/7 , WHEN HE''S THE PRESIDENT , republicans , democrats , independents will watch him
WITH a micoscope .

Those troubled assets have incredible spreads of margin for profit. I've wondered from the start how the hell there could be such phenomenal losses attached to mortgages that are at least 75% interest payments. While understanding a good portion of these notes were underwater & had considerable up front write downs, there should still be enough good mortgages offsetting most of that with the high interest margins carrying the rest. Good business practice (unlike the traders of these bundled packages) along with less administrative burn offs (AIG parties, etc.) should show an immediate profit. Only a fool could lose money on mortgages,, even with the substantial drop in home prices....

Bobby I am not sure how you think those mortgages could have margins for profit.

We are now talking about people taking out mortgages 2 times (or more) the property's real value.

At certain point a decent condo in SoCal was selling for 900k now it's listed at under 400k (and it's still going down). You do the math, where is the margin for profit.

Ben, I can't answer that in reality without knowing what the Feds paid for the distressed paper they've bought from these institutions. I just know under normal & even not so normal circumstances (as my illustration pointed out) that there's substantial margins of profits in long term mortgage notes.

With all due respect, people who paid those prices during this rush in greed undeniably need to be underwater if their bad judgment
outstripped the tangibles of what they were purchasing.

I can't argue the validity of the feds making money off that paper. I can only argue there's tremendous potential if managed properly.

Bobby and Ben,

From what I understand; the initial money was used by the Treasury to purchase senior preferred shares as well as warrants convertible to equity in the banks.

I am not sure how these are getting returns this high since the interest rate that the Treasury was supposed to receive was only 5%.