| "We believe that access to public support is a privilege, not a right. When our government provides support to banks, it is not for the benefit of banks, it is for the businesses and families who depend on banks... and for the benefit of the country. Government support must come with strong conditions to protect the tax payer and with transparency that allows the American people to see the impact of those investments." |
Which begs the question: If the money the gov't gives to banks is for businesses and families, then why doesn't the gov't just give that money directly and do away with the banking system altogether? Seems Geithner doesn't understand the role of the banking system or how it functions. Banks don't lend their reserves, capaital or deposits.
3 comments:
Nail on the head again!
Scott
Scott,
Are you as amazed and confounded by this as I am??
Yep. It's the same old story, though, in different clothing (how's that for mixed metaphors?). The mainstream story is always about "restoring confidence" before supposedly anything positive can happen, and they forget that confidence itself always comes from a restored economy . . . so restore the economy!
How many of these "toxic assets" would be less so if there were a payroll tax holiday, block grants to states, and infrastructure spending, and if on top of that the Tsy ordered Fannie and Freddie to buy conforming mortgages at, say, 4%? The latter, by the way, would refinance some of the toxic assets, in addition to reducing monthly payments for millions of homeowners.
Another point along the same lines . . . remember Republicans wanting a 4% mortgage a few days ago, and ready to "subsidize" the difference to banks currently lending at 5.25% or so? Somehow they didn't realize that the govt already owns Fannie and Freddie.
Scott
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