An Utterly Daft Bailout

The UK government has decided to increase its bailout from the original 500 billion pounds by offering a new sort of insurance on future defaults

Under the program, financial institutions can pay the government for insurance against future defaults, but there is what seems to me an utterly devastating catch…

THEY HAVE TO INCREASE LENDING

I really don’t get it. It is too much lending that made these firms financially unsound in the first place. 

“This is not help for the banks but help for businesses and families,” Mr. Brown said in a press conference.

I can sympathize with the desire to ease the credit crunch for families, but you are hurting them more when you are using their tax dollars to fund a program that is inefficient at actually helping financial institutions recover from this economic meltdown.

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