28-09-2008, 07:51 PM
A good diagnosis and prognosis of the debacle is available here:
http://solari.com/blog/docs/Final-Bailou...-Paper.pdf
Proposed $700 Billion Bailout Is Too Little, Too Late to End the Debt Crisis; Too Much, Too Soon for the U.S. Bond Market
By Martin D. Weiss & Michael D. Larson (24 Sep 2008)
Submitted to U.S. Congress, Senate Banking Committee, House Financial Services
* Note: This document includes a current list of troubled banks and information on how to find bank ratings.
Rather than paying inflated prices to buy junk paper from a select list of (crony?) financial institions, so they can defer or avoid massive write-downs that would show they are insolvent, the feds ought to concentrate of topping up the FDIC, SIPC, PBGC and other existing insurance programs for what is certain to be an eventual collapse of hundreds of sick banks. Their equit and (non-depositor-based) debt will be wiped out as was WaMu's, but the acquiring banks will go right on with lending and managing the written-down assets. There is no need for the USG to become the owner of (vacant and crumbling) houses.
http://solari.com/blog/docs/Final-Bailou...-Paper.pdf
Proposed $700 Billion Bailout Is Too Little, Too Late to End the Debt Crisis; Too Much, Too Soon for the U.S. Bond Market
By Martin D. Weiss & Michael D. Larson (24 Sep 2008)
Submitted to U.S. Congress, Senate Banking Committee, House Financial Services
* Note: This document includes a current list of troubled banks and information on how to find bank ratings.
Rather than paying inflated prices to buy junk paper from a select list of (crony?) financial institions, so they can defer or avoid massive write-downs that would show they are insolvent, the feds ought to concentrate of topping up the FDIC, SIPC, PBGC and other existing insurance programs for what is certain to be an eventual collapse of hundreds of sick banks. Their equit and (non-depositor-based) debt will be wiped out as was WaMu's, but the acquiring banks will go right on with lending and managing the written-down assets. There is no need for the USG to become the owner of (vacant and crumbling) houses.