If you, like me, are completely tired of the current disaster capitalism panic and only dreading what Paulson et al will cook up to let their cronies off the hook while further looting the Treasury and shafting the rest of us, may I recommend reading Robert Reich's blog?
http://robertreich.blogspot.com /
Of course, what he
recommends...
Whether you call it a reorganization under bankruptcy or just a hellova fire sale, the process should resemble chapter 11 under bankruptcy. Any big financial institution that wants to clear its books can opt in. But the price for opting in is this: Investors in these institutions lose the value of their equity. Executives lose the value of their options, and their pay (and the pay of their directors) is sharply limited. All the money from the fire sale goes to making creditors as whole as possible.
Meanwhile, policymakers work on a new set of regulations to ensure transparency on Wall Street -- governing disclosures, minimum capital requirements, avoidance of conflicts of interest, and better ensurance against stock manipulation -- so that, once the bad debts are off the books, the new numbers can be trusted.
... is far too sensible and fair to actually be implemented by the crooks and their cronies in Washington. But it's nice to know there's still some sanity in at least one economist's head.
