Originally Posted by SteveZ

We agree that Congress needs a complete flush in order to get rid of those who lilned their pockets over their Congressional careers at their constituents' expense and ignorance.

We do not agree that a "credit crunch" is a bad thing. A company's assets, especially their Grade-A accounts receivables determine the company's credit-worthiness and what the company's cost-of-money will be. The higher the cost-of-money, then either the company's profits diminish or the company must raise prices for goods/services due to increased costs. That is universal business.

Nothing stops any lender from assuming a lot of risk in issuing a loan, and those that take risky loans do so at higher-than-prime interest rates and special terms/conditions, or hope to sell the loans (at a profit) to someone who rates the risk as a better value. However, taking risky loans is RISKY, and the lender can lose its gamble just as well as win.

All of the "propping up" of the credit market seems to be to continue the practice of giving (and selling) risky loan instruments so that the seller continues making money due to lower risk via "co-signer." That includes past loans and well as new stuff, since there is NO FIX to this problem in any bailout bill yet.

Before we are ready to bail out the fianacial industry, the first look should be with the borrower. If Uncle Sam wants to prevent home foreclosures and business closures, then Uncle Sam - on a case by case basis - deals with the borrower for an equity stake in the collateral, even if that equity stake is 150% and the borrower is now indebted to the government at negotiated terms/conditions. HUD and the Department of Commerce are the logical agencies to take care of the commercial and non-commercial borrowers, and authorizing these Departments to fulfill these roles is better than giving the Department of the Treasury carte blanche.

If we must do something, let's take care of those as the low end of the financial feed chain - they have less of an ability to rip us off and a better record of paying their debts. Those "professional money managers" who created this mess should be able to take care of themselves without taxpayer assistance.

I just can't see throwing money into financial institutions directly. That's just rewarding the fox for eating your chickens, and opening the hen-house door to him for another raid.