I can understand the "angry tax-payer" approach.
The cost is large as mentioned by everyone. However let's throw this plan aside. Does anyone in Washington have an answer to following questions:
1. What is the alternative?
2. Do you understand the reaction of the markets?
3. Do you have any method to re-start the credit markets?
Here is my answers as far as I understand the environment. Looking forward to your opinion.
1. Don't see an alternative at the moment. Looking at the turmoil from last week, entire financial market had same answer.
2. A domino of bankrupcies may trigger a complete stall in the sector. If GS, MS, Wachovia go backrupt there will be many, many other that will default as a result. If confidence is completely lost in financials, I don't really see how markets can function.
Are you aware of the volume executed/cleared through the major brokers?
3. Don't see an alternative again. Markets have vanished for a lot of derivative instruments and even simple products. Bank prosecutions were the only way to create some transactions. Do you think that is the solution?
