Thursday, October 9, 2008

When they say "national banks," they mean it!

So, the latest rescue plan for the economy is that the government may directly inject capital into banks in exchange for an equity stake in the bank. Wow. Now that's a recapitalization.

I guess Bank X better not consider having any lavish retreats. Of course, much as the AIG scandal irritated people to no end (including me), if you think the government does not spend money foolishly guess again.

But does this end free-market capitalism -- a cornerstone of the greatest nation ever? I don't know. It is more big government and that bugs me. It will, however, bug me less if it helps free up the credit market and it gives taxpayers an investment stake in the banks the government bails out. Perhaps the depth of what is happening justifies this. But it also makes me want to parrot the title of this post: "Bankers of the World, Unite!"

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