Ethics

A Better Bailout Plan

By Ed Brayton

Lucian Bebchuk, a professor of law, economics and finance at Harvard Law School, presents what seems to me to be a much better bailout plan than the one being offered by the Bush administration (though again, I admit that this is not at all my area of expertise). Here's the summary:

The redesign should have three elements. First, the Treasury should only buy troubled assets at fair market value. Second, the Treasury should be allowed to purchase, again at fair market value, new securities issued by financial institutions needing additional capital. Third, to ensure that asset purchases are made at fair market value, the Treasury should buy them through multibuyer competitive processes with appropriate incentives.

Full post as published by Dispatches from the Culture Wars on September 29, 2008 (boomark / email).