here

this bailout is now up to 1 quarter of 1 trillion dollars. Nearly as much as the 'absurdly low' estimate of the cost of the entire Iraq war. And that does not even include the Feds exposure on the Bear Sterns/JP Morgan deal. With that in mind, we're close to 1/3rd of 1 trillion.

This is getting past crisis management, and into bad monetary policy to try to prop up bad risk management strategy on the part of Wall Street. The banks bought a bunch of bad paper in the form of bad loans wrapped up and osterized into novelty instruments that somehow 'magically' mitigated the risk of loaning lots of money to lots of people with lots of bad credit.

Our Financial system has some fundamental problems that probably will require a shakeout. I know this will be bad, but this is turning into socialism for the corporate super-rich. If we're going to have a free market economy, lets have a free market economy... Not one where the lowest classes assume all the risk (no bailouts for bad debts, bad investments, no job security, no home equity, etc etc) while the highest class (CEOs and corporate shareholders) get all of the money and none of the risk (because they have the fed behind them). Thats the very antithesis of free market capitalism.

If the only way to correct the idiocy indulged in by the large investment banks is to have a correction and a generational recession, then lets get it over with. Because if the financial institutions really are floating that far from reality, no amount of money will 'fix' them- eventually these forms of interventions will just crash the dollar, push the Fed into insolvency and turn a once-in-a-decade type recession into a once-in-a-century depression.

This is really getting silly. And at this point I believe we have passed out of responsible response to a crisis, and into corporate socialism and prop-manufacturing.

Yeti