$75 Billion Mortgage Debt Fund

I was trolling the internet yesterday when I stumbled upon this article...

Citigroup, Bank of America and JPMorgan are on Monday expected to announce plans for a fund to buy mortgage-linked securities in an attempt to allay fears of a downward price-spiral that would hit the balance sheets of big banks.

A person familiar with the discussions said that US banks collectively were expected to put up credit guarantees worth about $75bn for the fund, named the Single-Master Liquidity Enhancement Conduit (SMLEC).

But bankers said the scheme would evolve with the market and may only be as large as demand requires. The SMLEC would be temporary and capped in value, and would not be backed by any state guarantee. A person familiar with the proposals said it was hoped that other banks would join the syndicate.

I have always had a problem with the word SYNDICATE for some reason...

Here is a link to the full article...