ARE WE THERE YET?

Suspend ...until a deal is reached.

Now I do not intend to go to Washington to solve the crisis that we all agree is man made. No doubts here, as to its origins. Finally everybody agrees that we are in trouble. No more proclaiming that the economy is fundamentally sound, or mental recession from a nation of whiners. Those who made these statements include the republican candidate to the white house and one of his economic advisers.(before resigning?).
Unlike McCain, I will not suspend the publication of this blog, I will voice my opinion even after a deal is reached. My readers expect me to stay on the job whether there is a deal or not.

The orchestrated extortion.

Give me $700 billion now or all hell will break loose. In addition to the money, you will not have any rights whatsoever to ask me what do with that money.
If this is not extortion or blackmail, I do not know any other word that can fit the request made by the Bush administration. One things is certain: not all the financial institutions are in trouble. If that was the case, JP Morgan Chase, Bank Of America will not be buying the WA MU of this world. This being the case, why does the government want to buy ALL the bad debt from ALL the banks? It is almost like if your neighbor is filing for bankruptcy, you too can throw in your credit cards balances!
By fostering an atmosphere of fear and panic, reminiscent of the post 911 carnage, the Senators and Congressmen would rubber stamp this Hitlerian diktat. The gave unlimited powers to Bush, and we know what happened. There are some similarities here: when we invaded Iraq some told us that the citizens would line the streets to welcome the liberators. They lined the streets all right, but to shoot our soldiers. This package was supposed to sail through the house and the senate without any opposition...This time, the opposition came from both the republicans and the Democrats.

One size fits all.

Now, I may be wrong but the method to rescue Fannie and Freddie differed from the one use to nationalize AIG. We were told that these programs have yielded the anticipated results. My question is: why did the government use those same tools to rescue the banks? Why not lend them money and take an equity position in those in want the loans? Why fix it it when it is not broken? We all know that the shotgun approach is not the best way to solve problems, a careful analysis is needed.
I was shocked to hear Paulson admit that he did not know how to price the assets that he was planning to spend $700 billion on! Better yet, he decided that this was the only solution available, but he could not guarantee the results.
Stay tuned!