But, the folks in Washington are thinking about this as how do we secure our banking system and ensure it doesn't fail. They're probably thinking that if half of our banks fail, the economy is doomed no matter what happens from the ground up...

So, it seems like pairing this type of approach with some kind of insurance on the mortgage-backed securities or government investment in the banks in exchange for a stake (like the AIG deal) would be a good approach.

What you're saying is similar to a thought I've had. As I've been trying to understand this, basically our banks are all shot and this plan is trying to "reboot" our banking system. I wondered, well why not just make new banks?

I think that's infeasible though because of the scale of the problem. You're basically suggesting that our new bank be created by making the SBA a hundred or a thousand times larger. That's not a quick solution and not a long term solution.

I don't think people want to nationalize the banks. They want equity to reduce how much we get fucked but eventually we're supposed to get back out. Blowing up the SBA wouldn't lead to that.

A longer explanation is WaMu was victimized by mismanagement and misguided bets on exotic (and toxic) instruments such as option adjustable-rate mortgages.

-yahoo: wamu run

And yeah, thousands of your newly jobless neighbors will surely thank you for bringing down WaMu. Wait til you see the multiplier effect on that one.

I think that science is more than a bunch of trivia. Science is the notion that ideas are proven (or disproven) by facts.

Obviously by commenting this way, you fashion yourself as some financial genius, with me as knowing "less than nothing."

Educate me. Seriously. Tell me what I wrote that was incorrect on this post. Should be easy, readily easy, to disprove the few meager statements I made here--if I'm the big fool you fashion me to be. Argue with facts, not insults and we'll all be impressed.

If you seriously believe that I brought down WaMu, then you are perhaps too big of an idiot to even put together a rational or empiric argument. I've laid out my case, repeatedly, citing facts, other analysis and even the plain old numbers on what happened with WaMu. Prove. Me. Wrong. Or, fuck off.

Believe me, I'm more than a little concerned what this "sale" of WaMu will mean for the local economy. I'm also more than a little concerned about how expensive and ineffectual the bailout plans seem to be.

But, hey, let's go with your plan of maintaining ignorance and stupidity. The score today? I attempted (successfully, I think) to explain the multiplier effect concept. You ran your big fucking mouth, whining about me. Who did more to help out?