Because I love nothing more than to belabor, I bring you this MeFi thread, in which there are two excellent This American Life episodes discussing the financial crisis. One of the salient points made by Adam Davidson:
“One option is I come and I give you a thousand bucks, and I take all the crap out of your basement, and you get to keep the thousand bucks – that’s the Paulson plan. The other option is I come and I give you a thousand bucks, and I get to move into your house, I become a co-owner of the house, I might get to kick you out of the house and take all of your stuff.”
The latter option he describes is a stock injection plan, a plan that would have a far more beneficial effect on the economy, if only for its punitive value. For the banks (and their influential lobbyists), it’s pretty simple: a stock injection plan was never an option. However, apparently a clause was eventually included in the bill that was passed that allows a stock injection option at the Treasury Secretary’s discretion. This is excellent news, considering that our government’s money is actually our money, and I’d like for it not to evaporate.
If you’d like a really accessible summary of the situation, see The Financial Crisis, As Explained to My Fourteen-Year-Old Sister (also found via MeFi).
I listened to that most recent episode of This American Life on NPR this weekend. It was pretty great. I think I can safely say that I don’t understand a thing about the economy or this whole situation but that show helped me understand a little better. It was probably the most interesting thing I’ve heard on the radio.
the stock injection plan is definitely the right way to go. You have to ask yourself what the hell were all these government guys doing wailing around and why did Paulson want to buy toxic assets instead of preferred stock?
There’s a tremendous site about the stock injection – it has 4 parts that are must viewing! Check it out http://www.StockInjectionPlan.org – go there it’s your duty!