Tomorrow, the world will see what a sham the PPIP program is.  When it was first annouced, it was supposed to auction off 1 trillion dollars of toxic junk assets to 100+ asset managers in the private sector.

Now, the fed will introduce the PPIP program to only auction off 50 billion of toxic assets and only 9 assets managers?

What an absolute disgrace.  When the PPIP program was annouced, I said the goal of the program was delay, delay, delay, and the public would give banks money through secondaries.  This is exactly what has happened, and the PPIP will confirm this tomorrow.

Yes, the banks are going to still keep this toxic junk on their balance sheets, but now they have the cash cushion from the public sector from secondaries. 

This is where the shorts have gotten burnt the last few months, being absolutely correct on the PPIP plan, that they would be no private buyers, the banks would not part with assets for a discount, etc., and the shorts got totally destroyed anyway.

This is rule #1 in trading, you cannot fight the Fed.  Eventually they will win, even if the deck is stacked or not.

Keep in mind, the market has a short memory, but investors have blissfully been fooled.  The public AGAIN bailed out the banks, not the private sector, and this PPIP plan itself is an epic failure.

Welsh