But I think it is dangerous terminology, because there really is such a thing as printing your debt away.

True, but my point is that we are coming dangerously close to that. In fact, if the Fed is creating new collateralized dollars off the subprime-rooted assets, then I would argue that in fact the Fed IS trying to print its way out of the corporate elites debt. In other words- screwing the monetary pooch not even for the national benefit, but for the benefit of the rich and well connected.

If the fed is going to spend (slash risk) a good part of a trillion (and 300 billion is, despite TBs protesting, a good part of a trillion), what it (actually the gov't, not the fed) should do is start buying up the bad loans directly from the lenders at face, re-appraising the houses in question to the current market value (and deducting the diff from the loan value), and assigning interest rates and term (length) based on means testing. This would probably save the lions share from foreclosure. Those that it does not, the gov't can release the owners from and auction the property. Then impose regulation demanding minimum means testing for future loans, better truth-in-lending documents, etc.

Yes, this bails out the banks, I'm not against that entirely. Yes, this means some irresponsible consumers get to walk (but not with a profit)- that sucks. But the chosen method for fixing this problem I believe is setting us up for more pain in the future. It is anti-capitalism that is rewarding the capital holders for making bad bets, and pulling their fortunes out of the fire (or at least billions of dollars of those fortunes). This means none of the fundamental problems will be fixed by the financial institutions, which means in 6 months or 6 years, we'll be right up against the wall again.

When you say what you said, then people like Carl misunderstand you and have their misconceptions verified

Yeah, I do see your point.

(God knows what Tech thinks).

Does anyone care about his ravings at this point.

Yeti