One of the biggest arguments against the $700 billion bailout of Wall Streets bad debt is that by having the government clean up investment houses balance sheets, the same firms that caused the problem might make outsized profits in helping the government assess the debt, the New York Times reports.
Bill Gross, co-chief investment officer at PIMCO, said he can help solve that problem by offering his firms services for free.
We have a large and brilliant staff that can analyze and has analyzed subprime mortgages that can help the Treasury out, Gross said.
And Id even be willing to say that if the Treasury wanted to use our help, it would come free and clear, Gross added, pointing out that his firm takes in sizable fees from its $830 billion under management. He added that he and his associates first predicted the credit crisis would become far worse in July 2007 and would be rewarded just to be recognized for their foresight.
But some industry observers say that entrusting someone in the private sector to price the securities may not be a wise move since they may have a conflict of interest.