tag:blogger.com,1999:blog-5880610.post4550010576934391920..comments2008-10-03T08:39:21.373-07:00<b>Steve Hsu</b>http://www.blogger.com/profile/02428333897272913660noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-5880610.post-12175454405840698192008-10-03T08:39:00.000-07:002008-10-03T08:39:00.000-07:00It's not at all clear how the bailout will work. I think under the current bill they'll have pretty broad powers and they can take equity in banks, etc. Not much is really precluded.<BR/><BR/>I do have confidence in Bernanke and Paulson. If I did not I would be much more worried.stevehttp://www.blogger.com/profile/02428333897272913660noreply@blogger.comtag:blogger.com,1999:blog-5880610.post-69480782179096676902008-10-03T07:39:00.000-07:002008-10-03T07:39:00.000-07:00Steve,<BR/><BR/>Sorry, but I am all confused because of so many conflicting stories/explanations I have read lately.<BR/><BR/>I am still puzzled by why the plan is to buy up bad assets is better than equity (as I understand it was done by Sweden in the 90s). See, for example <A HREF="http://krugman.blogs.nytimes.com/2008/09/30/people-i-agree-with-part-one/" REL="nofollow">Krugman</A>. <BR/>It has been known to work, and seems safer to me; appears to me to be not an option purely for ideological reasons. It also seems that the distressed assets will be purchased at higher than market price, something that Warren would never do.<BR/><BR/>Also, I understand that $700 billion is not going to do it: need at least $5 trillion, according to some! No one really knows, I suppose.<BR/> <BR/>MFA<BR/><BR/>Anyway, the days of US lecturing the rest of the world on economic matters is over. The consequences for India and China would have been FAR worse if they had followed the advice on financial deregulation.Anonymousnoreply@blogger.com