Loading ...All these problems could have been avoided if Bernanke had decided to use the smaller Banks as competition to the Largest banks instead of trying to save the worst simply because they were big. He should have given each small bank 100 million and told them to keep 5 % for themselves but required to prove they lent out the rest at any interest rate necessary even 1/4 % simply to get the money out there in the private economy.Borrowers could have borrowed to pay off mortgages of high interst rates and would have avoided the whole mortgage crisis.Housing prices would have stayed up without panic dumping on the market .
Smaller banks could then go back to the Fed and repeat the process to get another 5% profit up front and prove they lent out the other 95 %,rinse and repeat until the Mortgage crisis is over and small banks grew larger and big bad banks disappeared with the new competetive enviornment.Bad mortgage lenders would have disappeared including Fannie Mae and nobody would need a bailout.Using the private sector to fix the problem would heve been far better than trying to perpetuate the bad corrupt prictices of big Financials..Big is NOT better !
Liquidity would have been restored to the private sector .The current problem is lack of liquidity and purchasing power in the private sector.
Interest rates would have gone nearly to zero in any case ,the difference is the LIQUITY would be in the HANDS of the PRIVATE sector instead of BIg BANKS.! Thats the DIFFERENCE !
The Administrate says the problem is private sector hoarding of money ! What complete idiots ..Hoarding what money if 50 % are on food stamps ? Academic egg heads or pin heads is more descriptive.