Can someone help me understand this?
If the whole goal of this $700 Billion bailout is to forestall the failure of big lenders, which
* wouldn’t be a problem for the deposits of any but the most ultrawealthy, since those deposits are already federally insured,
* but would dry up sources of lending, which “Main Street” needs to grow,
then why would you give the $700 Billion to the existing lending institutions, most of which have a history of making poor decisions (see “bailout”) and most of which are under investigation for fraud?
I have yet to be convinced that any money has to be spent by the taxpayers here. But assuming for the sake of argument that you have to spend $700 Billion to rescue the
rich bankers’ asses brokers’ jobs ability of the heartland to borrow money, why not use that money to open a new bank or credit union? You know, one whose profits would go to paying back the massive debt incurred. And one with new management, the no-history-of-fraud kind.