Another prescient quote:

22 03 2009

James Galbraith’s article No Return to Normal, that all the pundits have been talking about, has this quote that sums up what Geithner’s plan will result in – I wish us all luck:

The most likely scenario, should the Geithner plan go through, is a combination of looting, fraud, and a renewed speculation in volatile commodity markets such as oil. Ultimately the losses fall on the public anyway, since deposits are largely insured. There is no chance that the banks will simply resume normal long-term lending. To whom would they lend? For what? Against what collateral? And if banks are recapitalized without changing their management, why should we expect them to change the behavior that caused the insolvency in the first place?

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