FDIC Chair Shelia Bair seemed to sound the death knell for the PPIP Legacy Loans program when she indicated that some of parts of the program are still uncertain even as the FDIC was trying to put a pilot program in place to start shortly. The cause of the death of the Legacy Loans program was a toxic combination of policy and politics which caused major equity players to fear that the combination of government audit powers granted in recently-enacted legislation and the concern that the expected private profit-making would somehow be painted publicly as unconscionable after the fact.

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