Bailout package or not, US will face a recession and there would be significant impact on financial markets across the world, accompanied with a global slowdown.
The package does not address the core issue of mortgage holders' inability to able to pay back their debts. Instead it focuses on recapitalizing troubled institutions by buying back their toxic debts. Recapitalization is required, but should not be the first priority. The proposed increase in bank deposit insurance from $100,000 to $250,000 will not be enough to contain a run on the US banking system. I can go on and on.
The package will provide only temporary respite, and at this rate the US financial system risks a complete systematic meltdown.
As somebody rightly said ' The package is by Wall Street bankers for Wall Street bankers for problems initially created by Wall Street bankers'..!
The package does not address the core issue of mortgage holders' inability to able to pay back their debts. Instead it focuses on recapitalizing troubled institutions by buying back their toxic debts. Recapitalization is required, but should not be the first priority. The proposed increase in bank deposit insurance from $100,000 to $250,000 will not be enough to contain a run on the US banking system. I can go on and on.
The package will provide only temporary respite, and at this rate the US financial system risks a complete systematic meltdown.
As somebody rightly said ' The package is by Wall Street bankers for Wall Street bankers for problems initially created by Wall Street bankers'..!
