Bailout of banks not the trick
Bail out monies being injected into the economies of banks that have poisonous investments (i.e. derivatives) are showing little result as they are absorbed into the inflated capital these failed instruments represent. Each bailout of the banks only makes the problem last longer and worse.
Bailout the holders of negative equity mortgages, they will still have impossible repayments down the track. The economy will adjust hugely before it starts to recover. Our prediction is that about May/June there could be a massive deflation/adjustment that could see recovery start more quickly than people realize as false financial instruments fail rather than the bank behind them. If the bailout succeeds it is preventing mass bank failure at that stage.
So much more may be achievable by what Obama is about to do. Making the economic machine (people) work more rather than succumb to depression is a better answer. Banks are going to fail, and when they do, they perhaps will be nationalised, and the management replaced.
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