A Deal with the Devil????
Save the Financial System in exchange for destroying the economy????????
We now know that the banks were lying about the assets on their books. Now they are going to be forced to tell us the truth as they transfer them to the government at market value. When they do....you are going to see write offs that shock the world.
As a result, the balance sheets of banks will contract and lending will likely be constrained....even though the government will ostensibly relax reserve requirements.....after getting a new lease on life.....expect banks to be much more cautious on who they lend.
Extraordinary losses will force analysts to sharply reduce earnings expectations. Tighter lending environment will cause thousands upon thousands of businesses, municipalities, and individuals to declare bankruptcy.
In the end we will be told this is a necessary sacrifice to save our finanical institutions as many in America will be unemployed and broke.
The process will take years to work through.....and as we emerge we will likely be a more competitive nation and the outlook should brighten for our children. In the meantime, prepare for something we have never faced before.