On Apr 2, 2008, at 10:36 AM, Seth Ackerman wrote:
> Your position doesn't make any sense: We should just accept the
> bailouts
> and demand something "in return."
I don't think we have any alternative. There's no costless magic wand that the authorities can wave to make financial institutions healthy again, and homilies about the rich being made to take some of their own medicine won't help either. In order to prevent an implosion there has to be an expenditure of public money - there's just no way out of this. Dean's idea that Northern Rock somehow avoided that is badly wrong. The best precedent we have, the Nordic banking crises of the early 1990s, wiped out shareholders and displaced existing managements but still required the expenditure of 2-5% of GDP. It'd be nice if we got something in return, and the expenditures were financed by taxes on rich folks, but there's no way to evade the spending.
Doug