I must admit that this mess is making me dizzy. I'm confused. I'm pissed off, frustrated and everything else - like everyone else.
I also must admit that as much as I realize it takes time for complicated policy matters to materalize, I also realize that our rapidly deteroriating economy needs something to hold on to.
With that in mind, I had a few thoughts....
I don't know the implications of all of this, but have to wonder nonetheless why we don't hear more - I might be an idiot and feel free to shoot me down if my thoughts sound that way.
My first thought is what would be the implications if the administration said that we are not going to do a bad or toxic bank, but we will take one of the banks that the tax payers essentially own at this point and make it a national bank.
One bank. Perhaps it is Citi. Perhaps Bank of American really is the Bank of America.
I don't know, but obviously we have a few very, very large banks with built in large infrastructures that would suffice.
This would ease the ambiguouty and provide some direction.
Wall Street and everyone else would know that taxpayer handouts are done.
These other institutions might be able to get loans from the National Bank, but under real and strict conditions - BECAUSE it is a real bank.
It would take risk but would profit as a standard commerical bank does.
No freebies anymore and strings are most definitely attached.
Taxpayers would know that there is a specific special bank backed by the government like no other bank (beyond normal insurance etc).
Would this be enough to get credit flowing? Is it assinine?
The way things were done are not working and something must be changed, something must be done to gain real confidence and to get credit and the economy moving.
I don't see this as quick fix, but as a directional one that provides clear focus.
My other general thought is the administration to come up with a strict "bailout"
Firm. Detailed and take it or leave it and that's that.
Everything that a sane person and intelligent financial expert believes banks can and should do with a gain of large funds would be strictly attached to the funds.
Have a deadline in the near future to accept or decline.
After that, this continued circus of what to do and BS from the Republicans can't coninue as the banks will have made it clear once and for all where they stand on government involvement etc.