Meet the New Boss ...

Wed, 04 Feb 2009 16:16:14 +0000

My first reaction to the headline of Binyamin Appelbaum and David Cho's article in today's Washington Post, "Bank Rescue Would Entail Triage for Troubled Assets," was, What made this idea get any better in the four months since the Paulson Treasury proposed and then didn't implement it? The answer is nothing. This is just a more sophisticated way to give (future) taxpayer money to shareholders and non-insured creditors of banks that made poor investments. This is just more "Bailout in Lieu of Bankruptcy," and it is just as bad a public policy when a Democratic administration proposes it as when a Republican one does. Any bank that needs this kind of help needs a visit from the FDIC. For the best commentary I've read, here is Yves Smith.