Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
However the objective of my proposal is not to try to make completely insolvent financial institutions solvent - let them go into Chapter 11.   That is a black hole so big it simply cannot be filled with any money Obama and others are likely to be able to raise, and we risk huge inflation if we simply print money to fill that hole.  The objective is to cut taxpayers in on the action at current deflated prices - and thereby help put a floor under further deflation.

Insolvent institutions have no choice but to sell assets at current prices to meet current liabilities - unless we bail them out.  In fact bailing them out helps them to pretend that it is still business as usual.  

notes from no w here

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Sun Mar 22nd, 2009 at 06:13:32 PM EST
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