Wednesday, February 11, 2009

Hope...Not A Plan

The hope isn't simply that "vultures" will buy up big shitpile, the hope is that vultures will buy up big shitpile at high enough prices that it won't force an appraisal of bank assets that will show that they're insolvent.

With its plan to shore up banks that was announced on Tuesday, the Obama administration hopes to entice investors like Mr. Marks, who has $55 billion at his command, to buy troubled assets from the nation’s banks and enable them to make the loans needed to jump-start the economy.

The administration hopes, in short, to counterbalance some of the fear gripping the financial world with a bit of old-fashioned greed.

To combat the bust, Washington wants to marshal some of the same financiers who grew rich during the boom: hedge fund managers and corporate buyout specialists.

Some sort of nationalization is inevitable. Why the Obama team thinks it's a good idea to light a pile of money on fire first is beyond me.