Scaremongering

Bankruptcy, not bailout, is the right answer

(Jeffrey A. Miron is senior lecturer in economics at Harvard University. A Libertarian, he was one of 166 academic economists who signed a letter to congressional leaders last week opposing the government bailout plan.)

Talk of Armageddon, however, is ridiculous scare-mongering. If financial institutions cannot make productive loans, a profit opportunity exists for someone else. This might not happen instantly, but it will happen.

Further, the current credit freeze is likely due to Wall Street's hope of a bailout; bankers will not sell their lousy assets for 20 cents on the dollar if the government might pay 30, 50, or 80 cents.

Toward the end of his article, Mr. Miron writes:

The final legislation will probably include numerous side conditions and special dealings that reward Washington lobbyists and their clients.

Ya think?

I was just thinking today.

This Yahoo story Fed makes billions available to battle crisis.

The Federal Reserve and foreign central banks moved Monday to pump billions of dollars to cash-strapped banks at home and abroad in a dramatic bid to break through a credit clog and spur lending.

Billions? Where did they get billions without the Congressional Bailout? Why do they need the Congressional Bailout, if not for the money?