Two industries came up for nationalization last week, one was banking. The interesting and kind of scary thing about bank nationalization was that some guy from the IMF was on the radio being interviewed and it was his JOB to provide infusions of cash for failed foreign economies, in exchange for which gift they basically took the ill managed banks of these countries, recapitalized them, fired all the executives, nationalized them. It's precisely the same medicine he prescribed for US banks, but said we couldn't do it because the entrenched power structure had too much to lose. In marking bad assets to market value, the presumptive capital of the banks is wiped out, so the supposedly wealthy shareholders take a bath. That's too unpleasant for them to contemplate: certainly nobody can be expected to bring that kind of lightning down upon themselves, eh? Such a move would have to happen suddenly (this guy said) 'cause else all the OTHER bankers would pull their alleged capital OUT in fearful anticipation they'd be next. This would leave the bank balance sheet even more impoverished.
I think it's interesting to try to assign "blame" and ask, in the wake of that, whether the bank or the homeowner should be recapitalized. In the latter case, at least we (the taxpayers saddled with this) have a paying tenant, right?
