« $20,000 $25,000 Reward for Obama/Ayers/Dohrn/Khalidi Tape | Main | William Ayers Being, Well, William Ayers [Vinnie] »
October 28, 2008

How's That Bailout Working For Ya?

I was hoping to finish a comprehensive post on the Credit Crisis that Never Actually Happened (data is now out through October 15; another all-time record high for lending), but that's going to have to wait 'til after Election Day. For now, let's look at what our panic bought us:

The infusion of federal money is to rebuild banks’ battered capital reserves so the institutions would feel comfortable resuming more normal lending practices. But that confidence was undercut somewhat when reports surfaced that bankers might use the money to buy other banks. Indeed, the government approved PNC Financial Services Group Inc. to receive $7.7 billion in return for company stock on Friday and, at the same time, PNC said it was acquiring National City Corp. for $5.58 billion.

There is little federal officials can do about it. There is no language in the bailout bill that specifically obligates banks receiving money to increase their loans. Officials had argued that attaching strings to the capital-infusion program would discourage financial institutions from participating.

Hell, yeah, the bank will take your money. They've got plans, suckers, and since they're already lending at record rates, why not use the windfall to buy up the competition?

I've highlighted the phrase "resuming more normal lending practices" because that's exactly what we don't want banks to do. The recent norm for banks has been subprime loans and consumer credit for all takers. All these stories about people not getting their home loans or having credit cards denied? What did you expect? We told the banks and other lenders to fix their reckless lending practices. On the margin, of course, there are going to be people denied credit now who could get it earlier. (Once again, however, keep in mind that the Fed data shows that credit is still growing in the aggregate.)

Later: Don't get me wrong; I'm not saying that everything is just peachy. What I am saying is that a credit crunch wasn't one of our problems requiring giving unprecedented power to the federal government. At least not a current credit crisis. With the way things are going south now, it's not hard to believe that at some point the crunch will actually arrive.


digg this
posted by Gabriel Malor at 11:39 PM

| Access Comments




Recent Comments
LASue: "The Leah Remini show is on. It's now making more s ..."

Jean: "Republicans had to save Obamacare before they coul ..."

Donna&&&&&&V.: "almond joys are good. And I like Mallow cups more ..."

CharlieBrown'sDildo: "They are like a sports Obama. Too much idol worshi ..."

Peaches: "It always sucked when I picked out a chocolate fro ..."

grognard: "I hate to say it, but single payer is the inevitab ..."

Big Fat Meanie: "For the sake of baseball, end the infield shift! ..."

bluebell : "Blutarski, I've long seen warnings about the comme ..."

Donna&&&&&&V.: "I'm glad someone likes Circus Peanuts. to me, the ..."

Peaches: "A demain, mes amis.  God bless us, every one. ..."

torabora: "Democrats to Republicans: Here, pull my finger! ..."

concealedkerry or submit: "Republicans had to save Obamacare before they coul ..."

Recent Entries
Search


MuNuvians
Polls! Polls! Polls!
Frequently Asked Questions
The (Almost) Complete Paul Anka Integrity Kick
Top Top Tens
Greatest Hitjobs

The Ace of Spades HQ Sex-for-Money Skankathon
A D&D Guide to the Democratic Candidates
Margaret Cho: Just Not Funny
More Margaret Cho Abuse
Margaret Cho: Still Not Funny
Iraqi Prisoner Claims He Was Raped... By Woman
Wonkette Announces "Morning Zoo" Format
John Kerry's "Plan" Causes Surrender of Moqtada al-Sadr's Militia
World Muslim Leaders Apologize for Nick Berg's Beheading
Michael Moore Goes on Lunchtime Manhattan Death-Spree
Milestone: Oliver Willis Posts 400th "Fake News Article" Referencing Britney Spears
Liberal Economists Rue a "New Decade of Greed"
Artificial Insouciance: Maureen Dowd's Word Processor Revolts Against Her Numbing Imbecility
Intelligence Officials Eye Blogs for Tips
They Done Found Us Out, Cletus: Intrepid Internet Detective Figures Out Our Master Plan
Shock: Josh Marshall Almost Mentions Sarin Discovery in Iraq
Leather-Clad Biker Freaks Terrorize Australian Town
When Clinton Was President, Torture Was Cool
What Wonkette Means When She Explains What Tina Brown Means
Wonkette's Stand-Up Act
Wankette HQ Gay-Rumors Du Jour
Here's What's Bugging Me: Goose and Slider
My Own Micah Wright Style Confession of Dishonesty
Outraged "Conservatives" React to the FMA
An On-Line Impression of Dennis Miller Having Sex with a Kodiak Bear
The Story the Rightwing Media Refuses to Report!
Our Lunch with David "Glengarry Glen Ross" Mamet
The House of Love: Paul Krugman
A Michael Moore Mystery (TM)
The Dowd-O-Matic!
Liberal Consistency and Other Myths
Kepler's Laws of Liberal Media Bias
John Kerry-- The Splunge! Candidate
"Divisive" Politics & "Attacks on Patriotism" (very long)
The Donkey ("The Raven" parody)
News/Chat
Archives
Powered by
Movable Type 2.64