I believe it was the ever controversial global financier George Soros who offered what was to me the sanest remedy for the financial crisis. Rather than have the government buy a lot of bad paper, worthless loans, etc., he proposed something quite simple.
Soros proposed that since a cash infusion was the most vital aspect of recovery and would help reduce the tight credit, the Fed should invest money directly with the banks and then take an equity position in each of the banks that borrowed this much needed cash. There was a lot of moaning on Wall Street about his proposal, probably because a lot of those who caused this debacle in the first place would stand less of a chance of profiting from the government bailout. Some even declared Soros’ plan was…gasp…Socialism. If that is the case, and you can certainly argue it is, then how do the same people regard government ownership of the collapsing brokerage houses, mortgages and institutions like AIG?
Anyway, days pass and the market keeps on dropping like an anvil in an air shaft, and now the Fed announces it will be lending money directly to businesses outside the financial sector This was reported by Yahoo and the other news agencies. In fact, the Fed will be picking up the commercial paper various business accrue to pay salaries and buy supplies.
Look, we all know with things as bad as they are it is incumbent upon the government and everybody else to do whatever they have to do to pull the economy out of nose dive. But like most of those reading this, increasingly I get a feeling that there is growing desperation. To mimic the famed screenwriter, William Goldman, “nobody knows nothing,” and it is really starting to show.
Perhaps Sorors’ idea is not such a bad one, after all. Bypass all the bad debt and give the banks money to work with. Banks can then extend credit to businesses and perhaps get the economy flowing again. Maybe it will work. Maybe it won’t. But as we did during the Great Depression, try anything, and if it works keep doing it. We are a pragmatic nation, after all.
One reply on “George Soros May Have it Right on the Fed Bailing Out the Financial Crisis”
Ironic that the man who OWNS the democratic party, yet in his own words is some kind of genius with predicting economic bubbles, is now giving advice after the fact. He truly owns the democrats — in the words of his own pet project moveon.org — I’m not making it up. I’m just repeating.
Soros and his friends (like the Sandlers) are the economic terrorists who very deliberately caused this problem. They loaded up our government with those Ninny’s who pandered to his agenda, which was to keep the housing market deregulated so that these nuts (Soros and friends) could take full advantage of the situation. Theysell the toxic loans and the banks fall. And conicidentally the economy falls just in time to give their Mansourian candidate the ability to blame Bush. This is not a coicidence.
I don’t think it was just about making money, but about trying to take over the US. Although it is his money that has given him the power to take over the US by controlling the media, the DNC and our credit market (and probably much more that I haven’t even read about yet).
He is the one who caused it. But that probably means he could fix it. But would anyone ever trust his intentions? He’s a psycho.