March 27, 2009 2:00 am

Crisis Call Tonight at 6:30PM Eastern

You must register at least 10 minutes in advance for the call tonight at 6:30PM Eastern -
https://www2.gotomeeting.com/register/975697212

Needless to say, if you were short the markets, today was a very scary and painful day. Many of you are wondering What Happened and What’s Next.

I don’t know that there is anything I can tell you that will make you feel better after today, but I have scheduled a call for this afternoon to answer any questions and to explain a bit about what Geithner is proposing. I will discuss the example below . . . which comes from the Treasury website. If you want to read the release here is the link - http://www.ustreas.gov/press/releases/tg65.htm

If we hear more on the plan tonight and overnight from Asia and Europe we will hold a conference call in the morning, but I must reserve that space for clients only. We are offering a two week free trial of our services. If you are interested, email David@Morgan7.com.

Sample Investment Under the Legacy Loans Program

Step 1: If a bank has a pool of residential mortgages with 0 face value that it is seeking to divest, the bank would approach the FDIC.

Step 2: The FDIC would determine, according to the above process, that they would be willing to leverage the pool at a 6-to-1 debt-to-equity ratio.

Step 3: The pool would then be auctioned by the FDIC, with several private sector bidders submitting bids. The highest bid from the private sector - in this example, - would be the winner and would form a Public-Private Investment Fund to purchase the pool of mortgages.

Step 4: Of this purchase price, the FDIC would provide guarantees for of financing, leaving of equity.

Step 5: The Treasury would then provide 50% of the equity funding required on a side-by-side basis with the investor. In this example, Treasury would invest approximately , with the private investor contributing .

Step 6: The private investor would then manage the servicing of the asset pool and the timing of its disposition on an ongoing basis - using asset managers approved and subject to oversight by the FDIC.
ter.