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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: stockman_scott who wrote (189985)	3/11/2009 4:19:27 PM
From: geode00	Respond to of 306849

"Another option—which recently received the reluctant endorsements of even Alan Greenspan, James Baker, and Lindsey Graham—is temporary nationalization: the government takes over the most troubled banks, splits off their toxic assets, puts those assets in a publicly owned “bad bank,” and sells off the healthy parts of the businesses." Another option is to let them fail which wipes out shareholders and many creditors anyway and go around the toxic financial intermediaries and capitalize the smaller banks and credit unions and, heck, maybe even the SBA to get credit moving without pleading with the toxic banking system. Who knows how much more the toxic system will require before it deigns to begin lending again? Credit cards are trying to pull in, perhaps, 40-50% of their credit lines outstanding while piling on usurious rates on debt-laden consumers. What does that help? We could keep pumping money into this black hole, they could keep using it to shore up their balance sheets and refuse to lend because, heck, they need the money for even rainier days. Isn't this what they have been doing all along?