David Kotok Explains Why Geithner's Toxic Asset Plan "Stinks"

Business Insider ^ | 4/1/2009 | John Carney/David Kotok

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Tim Geithner's Public-Private Investment Program--or Pee-Pip, as they're calling it in Washington--grants a massive subsidy to banks by encouraging investors to overpay for trash assets. We've explained this a number of times, in a number of ways. But perhaps the clearest explanation we've come across was written by David Kotok, the chairman and chief investment officer of Cumberland Advisers.

Here it is:

Dear Reader: Please give me 8 minutes to explain the $1.1 trillion federal government Public-Private Investment Program (PPIP).

[mojito]

Another fund manager rips on Geithner's plan.

[mulligan]

Truth is truth even if the government does not like it. And they really hate truth. But, if they can fool the public they love it.