Monday, March 23, 2009

Geithner: My Plan for Bad Bank Assets -

"But as we fight the current crisis, we must also start the process of ensuring a crisis like this never happens again. As President Obama has said, we can no longer sustain 21st century markets with 20th century regulations. Our nation deserves better choices than, on one hand, accepting the catastrophic damage caused by a failure like Lehman Brothers, or on the other hand being forced to pour billions of taxpayer dollars into an institution like AIG to protect the economy against that scale of damage. The lack of an appropriate and modern regulatory regime and resolution authority helped cause this crisis, and it will continue to constrain our capacity to address future crises until we put in place fundamental reforms."

Considering that the "toxic loans" that are at the heart of this problem were made by government mandates, it's unclear to me and ignored by Democratic apparatchiks how new and or improved regulations will work. What we need are regulations on what Congress or the President can force businesses and individuals to do by pulling policies out of their ass... like they are doing now, or like they did when on multiple occasions they asked, no demanded, that lending agencies make even more bad loans than they had in the past.

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