Mr kumar

Please, China, Sell Your Treasury Notes!

That will never happen, the ideal will never sit well with majority of the politicians here.
How can they justify blocking deals for a chinese buyout of 3Com this year, CNOOC buying UNOCAL and Dubai ports acquiring US ports
and then allowing them to buy GSE securities.
People will get fits about the fact that chinese and middle eastern bankers will now own the most important securities of the american dream

Should the US Government Buy Distressed Bonds?

i disagree, this will set a bad precedent going forward , banks will continue reckless behavior and will look at the fed to bail them out by buying the junk.
If Buffeet thought that even at the bargain basement prices these securities had value , he would have made a move against buying them from any of the banks.
Some other investor might have a move also , instead buffett made a move only to take over only the muni business.
I am completely against the fed rate cuts also , thats like bailing out these institutions and encouraging bad bevaior.
Its not a bailout for all the home-owners who purchased homes with ARM's within the last 3 years, with the so called lower interest rates , even if they qualify into a fixed rate mortgage , they will still be paying mostly INTEREST to these financia institutions , these people are paying high amount of INTEREST on a deprreciating asset.