With the House’s passing of the bailout bill, (excuse me, “economic stimulus package”) the financial sector will be looking forward to the injection of $700 billion from the federal government. However, this hasn’t eased the pain quite yet, as the DOW has fallen below 10,000 points this morning, and foreign markets are feeling the sting. Today, after a few days to peruse through the document, here’s how people are reacting to the largest economic bailout in our history.
- “With Congress having approved a $700 billion banking bailout, historians, economists and pundits are also busily debating the ways in which Wall Street’s demise will filter into the popular culture, The New York Times’s Tim Arango and Julie Creswell write.” – from End of an Era on Wall Street: Goodbye to All That, at DealBook
- “I was wondering how the Federal Bailout Bill grew from 2 1/2 pages to 451 pages. Here are a few items in the EMERGENCY Senate bill.” – from Federal Bailout Bill and the Pork, at BankruptcyProf Blog
- “European nations scrambled on Sunday night to prevent a growing credit crisis from bringing down major banks and alarming savers as troubles in financial markets spread around the world, accelerating economic downturns on three continents, The New York Times’s Carter Dougherty, Nelson Schwartz and Floyd Norris reported.” – from Financial Crises Spread in Europe, at DealBook
- “Europe’s central governments are in panic mode – trying to guarantee or nationalize as much as they can separately before the massive global banking system actually crumbles (if it ever does). But unlike the U.S., Europe is having a difficult time agreeing on the (if any) bailout plan, and each of Europe’s sovereign governments are attempting to save their own necks. However, since much of Europe is joined by a common currency (the euro), the recovery of each country depends on the strength of the sum.” – from Europe’s flight to bail-out, at News N Economics
- “Why do many economists prefer nationalization (or some more modest version where government takes control of financial institutions) to the bailout approach? Under the bailout approach, Treasury purchases mortgage-related securities from banks in a reverse auction. Currently, these securities are not being traded even though they clearly are worth something (they give holders the right to a fraction of mortgage payments, which is worth some amount greater than zero unless homeowners will default immediately and their houses are worth nothing in foreclosure).” – from Bailout, nationalization, policy, law., at The Volokh Conspiracy
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