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Let's try to look beyond last week's political scrap over repeated bailouts of the banking system, and consider some of the longer-term consequences of the billions that the American government has already thrown — and in the near-term will continue to throw — at America's financial institutions. Start by giving a wide berth to stories about a possible default by the government, the end of the dollar's reign as the world's reserve currency, and runaway inflation.
A bailout won't wreck economy
Seeded on Sun Sep 28, 2008 11:45 AM EDT
Article Source: The Times- Enjoy this article? Help vote it up the 'Vine.
- Public Discussion (2)
The unanswered question, of course, is whether a bailout will have its intended effect of enabling the banks to start lending again. And, more important, if they can lend, whether they will indeed lend, or continue to hoard their cash. It is possible that handing over cash to the banks won't induce them to lend it. We just don't know what these increasingly skittish institutions will do.
- 1 vote
#1 - Sun Sep 28, 2008 11:47 AM EDTThe Time's article is hogwash. No surprise then that Stelzer advises readers to steer clear of dissenting opinions. The bottom line is, if the assets had value there would be no push for a bailout. China rejected the assets because they are worthless; they were smart enough to recognize a bad investment when they saw one. The rhetoric that we the people are getting something worthy in return is utter rubbish and spoken only to sway public opinion.
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