A lot has been written about how Paulson arrived at the $700 billion dollar number. "It's a really big number," is the answer. Is there a legitimate reason why they need a really big number? If the crisis is as bad as many fear, they want to shore up confidence and stave off panic. Big numbers do that.
Is there a reason why the government might not release all of the details underlying the reasons for the bailout to the American people? Again, if it is as bad as some say, releasing the details could create more panic.
Now, I have no crystal ball, and I have no way to judge how close to an all-out depression we really are. But, I do know that people are nervous. Almost everyone I am acquainted with who has any funds in the bank is shifting money around, making sure everything is FDIC insured, buying gold, etc. I don't think it would take much to tip this crowd into a run on their bank.
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