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The Banking Crises

September 22, 2008

“Welcome to History”, an easy to understand explanation of the meltdown in the financial markets.

Quote:

This is what Paulson and Bernanke are trying to manage. They have done three big things in the past couple of days:

1. Proposed a huge RTC-like government “bad bank” that banks can dump all their bad loans into. (Apparently, though, unlike the case with the RTC, they will not need to declare bankruptcy to do it.)

2. Provided a federal guarantee on money-market accounts.

3. Promulgated a temporary ban on naked shortselling for about 800 financial stocks (in related news, the new recommended medical practice when you discover that you have a fever is to smash the thermometer against the wall, since this makes the problem go away).

I had never heard of this site (The American Scene) until today.  I skimmed through a few of the postings and at first glance, it looks like something I’ll want to check out regularly.

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