You may realize this, but it's not a question of what's enough to keep the banks alive. It's a question of what's enough to satisfy the greed of Paulson and his gang.

For some reason, the Left thinks that not passing the bailout will really stick it to those Fat Cats on Wall Street. Unfortunately for them, those Fat Cats are some of the best educated and most connected people in the world. The Fat Cats? They’ll be fine. It’s the poor and the poorly-educated (read: Democrats) that will suffer the most.

I don't want a bailout; let's burn it all down, get rid of government pensions and contracts, and build it back up again. Of course, I'm more libertarian than most...

of liquidity was done this morning. And yet the credit market is still frozen, because why hash out a deal when you might get it for free by the end of the week.

The stock market could be tanking because of the banks in Europe that were rescued this weekend, not to mention the "takeover" of Wachovia.

Citi is about 28% owned by the Saudi Royal family. I can't possibly imagine there being any sort of political or geopolitical conflict of interest that arises out of that. Can you? But you keep blaming the Jews for everything, liberals. Good job.

Isn't this like buying up a bunch of junk cars in the hope that folks will think that they are worth something and want to buy them from you?

Just asking.

have been saying from the start that 700 billion isn't enough. There is no "enough" in a Keynesian-blessed credit-based banking system. There is only exponentially larger and larger amounts of credit infusion, until it dies.

The sooner it dies, the lesser the pain. Don't try to fill this bubble with money. Let it crash. Hopefully, it'll pop the bigger bubble all of Keynesian economics is based on and we'll finally see the end of central reserve banking.

Not that I'd bet on it, but it'd be nice.

We are about to set up the greatest ongoing financial scam in the U.S. since the Federal Reserve was created.

Banks borrow money from Federal Reserve and invest in trash paper. Banks sell paper to new "Office of Financial Stability," which by the way won't die, ever, since it's a government office. The "Office of Financial Stability" sits on the paper for a while, then sells it back on what is a profit on the books but, thanks to the inflation of the currency, will come out an actual loss for the taxpayer. Then banks, who get a lower interest rate on their loans from the Fed than the inflation rate, sell it right back to said office. Thanks to the "profit" made by the Treasury, the 700 billion "limit" on outstanding loans is completely circumvented.

The entire scheme is an elaborate mechanism to transfer money from taxpayers to banks through the mechanism of inflation. Meanwhile, it doesn't matter if the paper being traded is completely bunk: It could literally be monopoly money and work just as well.

Long live the banking elite!

No, it's not like buying junk cars. Everyone talks about buying "bad debt" as if that's all that's for sale. The bundles of debt in question actually have a lot of good debt in them, too. In fact, mostly. But their yield to maturity has been damaged because there is more bad debt in them than there was supposed to be when Moody's rated them and when hedge funds leveraged themselves up to 30-to-1 to buy more and more of them. The institutions that lent all that leverage had to take back the collateral -- i.e. the bundles of mortgages (good and bad). But no one knew how to price the bundles at this point, so prices plummeted. It's called a panic, Trainman, because people panicked. There's an irrational element there, exacerbated by the mark-to-market rules that required the lending institutions (remember, I'm not talking about the mortgage lenders, but those who lent to the hedge funds) to book the collateral at very low prices, damaging their balance sheets and making it impossible for them to borrow more money (kinda like you trying to borrow money after you lost your job and maxed your credit cards). It's that lack of liquidity that threatens the economy. Personally, I would have preferred that the government simply become the lender in the short-term capital market instead of making the lenders whole, but one way or the other, they've got to do something.

The main point is this: there is still value in those bundles of mortgages. They are not "bad debt," they're debt that isn't paying out as much as was originally intended. A "junk car" is usually a car that doesn't run. These cars run. In fact some, though the paint's a little faded, might run quite well. We're not going to lose our full outlay on this deal.

One last point, new analogy re the whole "executive compensation" issue, the anger people feel about bad actors getting away with their bad acts. For one thing, a lot of those fat cats are in fact going to lose a lot, if not everything. Second, it's irrelevant at this point. If an arsonist sets fire to your house and is subsequently trapped inside by the flames of his own making, do you tell the fire department not to save the house because in doing so, they might spare the arsonist?

One thing I'm surprised about is that no one has connected the bailout with the conservative ideology of "starve the beast". As most of you probably know, the idea is to (through tax cuts and increased spending) make the national debt so large that all government can do is fund defense and pay interest on the debt, thereby eliminating entitlement programs that conservatives hate.

Bush has doubled the national debt in his time in office to about $5 trillion. The Congressional Budget Office says we need to count the obligations of Fannie and Freddie in the debt as well, which doubles it again to about $10 trillion. Now the bailout adds almost another trillion.

Another interesting point. The comments made by the PNAC about "a new Pearl Harbor" has fueled conspiracy theories about 9/11. Why hasn't the "starve the beast" philosophy fueled theories that the market meltdown could in any way have been planned. At this point I don't think so, but it is interesting to think about. Both 9/11 and the market meltdown seem to be gift wrapped events that fit in with conservative ideology.