Will toxic assets now uniformly be called “legacy assets?” In a March 23 Wall Street Journal opinion piece, U.S. Treasury Secretary Timothy Geithner wrote,: “Market prices for many assets held by financial institutions — so-called legacy assets — are either uncertain or depressed.” FDIC chair Sheila Bair has also changed her terminology to follow Geithner’s lead. Reuters reported that Bair said “U.S. banks have about $1 trillion of distressed ‘legacy’ loans on their balance sheets,” and that Bair also said “the ‘legacy loan’ portion of the program can realistically cleanse the banks of about $500 billion of those assets.” It will be interesting to see if the national media rushes to use the phrase in place of the far more inflammatory term “toxic assets,” which it is meant to replace. For now, quotation marks are being used by reporters to set-off the phrase. Geithner can’t take credit for the terminology, though. Back in June, Bloomberg.com ran an article quoting Citigroup CEO Vikram Pandit as “announcing that part of his plan to turn Citigroup around was the sale of $400 billion in ‘legacy assets.'” No word yet on whether the TARP program will now be known as the LARP program. As several bloggers have already pointed out, LARP is already an acronym in wide use among geeks worldwide. Live-action role playing (LARP) is defined by the Urban Dictionary as “a type of game where a group of people wear costumes representing a character they create to participate in an agreed fantasy world. Uses foam sticks as swords, foam balls as magic and other props to create the games world.” Oh, the delicious irony of it all.
