Saving and killing banks is just a decoy to the real problem and that is massive credit flow.

These banks didn’t invent the subprime loan, the government did. The banks can’t tell if the guy making the loan is an investor or about to lose his job or die before the mortgage is paid.

The investors still don’t have a reliable way to rate their investment. The third party system overvalued the quality of these toxic bonds by several rankings. Even with this new toxic bond plan, there is no way to trust the administration or a future administration will stick with its promise to back the toxic bonds like the treasury backs its bonds. After all this administration has continued to claim that contracts are renegotiable.

The government still hasn’t found out how the poor can afford to pay off even a subprime loan and investors can still use subprimes to flip property with little downside.

This plan not only assumes that investors will buy these toxic bonds, but future toxic bonds and that there will be enough investors to do this (while at the save time the treasury printed $300 billion to buy its own bonds because of the lack of investors).

The treasury may save some banks and nationalize others, but its not fixing how the credit system works or creating enough investors to keep it running.

Greg-
My understanding is that the treasury isn’t protecting the investor from default, the treasury is matching $1 to a private party’s $1 and then offering to lend up to $5 additional dollars. In the case of a default, the investor loses the $1 ante, but has the option of walking away from the borrowed sum (at the risk of a reduced credit rating of course). Where in this scenario is the Treasury called upon to back anything outside of the initial pony-up or am I just confused about the details of how this works? Also, I think it’s a good thing that a system whereby going forward investors cannot count on the full backing of the Treasury. This should restore market discipline to some degree.

I hate to sound like John McCain, but the government should just b_uy the bad mortgages, offer the homes to people in trouble and s_ell the rest. They may lose money on the deal, but the whole sh!thouse wouldn’t burn down. If the loans go into default then you get a snowball effect that will make the problem 100x worse.

I don’t see why the government doesn’t run all the banks that had to receive bailout money thru the FDIC to get restructured. The “too big to fail” banks could get chopped into several smaller banks and all of the toxic assets dumped. Then the bailout $ could be used to bailout the homowners and stabilize them.

I’m so glad you could find one of the 10% of economists (not a fact, just a hyperbole) who like Baraconomics. The vast majority of market economists are scared to death with all of this absurd spending. The ones who approve this plan (or accept it at least) want a bigger government anyway.

I would like to see a little more Greenspan (or his peers) and a little less Pelosi in the economic policy-making.

Personally, this radical non-ideologue isn’t so sure that the “insane” spending by treasury has as much to do with increasing the domestic power of the American government as it does the transfer of global power to the new rulers of the universe, China.

Isn’t it suspicious that despite some unemployment, the Chinese are in a more dominant financial position now than before the economic crisis began. This predicament (for us, not the Chinese), should give anyone with a brain and reasonable amount of common sense reason to pause, considering lengthy trail of bread crumbs that led up to the current situation; that is, unless he/she’s afraid of being labeled a conspiracy theorist.

And then there’s the reason for the economic crisis itself. When smart people do dumb things, nine out of ten times, the things they did weren’t so stupid. Was the lack of supervision an example of corruption or treason? Ask a lobbyist with a few drinks in him.

Google “Anatomy of a Bank Takeover” by NPR to see how much secrecy (to avoid a run on the bank), manpower and money is needed to close one small local bank. Your dreams of massive takeovers will be crushed, but it’s worth knowing (and it’s an audio file as well as transcript!).

Guys, go back to your ANT collection and leave the grown ups to elucidate, please. Unless you have something productive to add.

For brevity, I’ll leave out what too much carbon in the atmosphere does, unless you’re interested.

Maybe the elephants? wait, no elephants in North America, yet no forests. What a mysterious puzzle.

and no other creature is stupid enough to destroy the trees, only one cause remains. HMMM!!! I wonder what that could be.

Since the beavers knew what they were doing before they were decimated, and no other creature is selfish enough

and her sensors have been damaged, will do whatever is necessary to stop the cause of damage, even if it means putting it all on ice for a while.

Earth, being a living system, attempts to compensate, but since the system is so out of wh.ack

Too much of either can cause an ice age or drought. Wait till you see what happens when the compressor starts ‘malfunctioning’.

the problem, or too much precipitation, which does the same in summer or creates ma$sive snowfalls in winter.

exacerbates

This sends the evaporator into overdrive or inaction depending on the circu.mstances, this results in either too much water vapor in the atmosphere which

The Earth; being a living, self adjusting system, uses the trees as it’s condenser, they use the high energy infrared and ultraviolet spectrum in the process of photosynthesis that will create Oxygen, which freely joins with hydrogens when it reaches the proper altitude to create water. They also act as Earth’s thermostat.

Say the thermostat in your house goes bad, completely on the fritz, the system will either heat up and keep going past where it’s supposed to be set or cool off so hard that it will freeze up and you will need an evaporator, compressor and maybe even a new condenser.

If I may take a stab at it, not that PrettyClueless & co. will even care, or try to understand…