The fact that the announcement of the plan was the only thing that saved the DOW from a huge crash last Wednesday proves you are wrong.
A large part of the scare was that local banks experienced a run on CD's and so-called safe investments. Paulson's announcement of the plan reversed it. Thank God.
I am not trying to start an argument...but you don't understand the fundamentals of economics. You might be elated by Paulson's actions yesterday, but will you be as elated when it is shown that his actions have made the matter worse in the coming weeks, months, and years?
It proves nothing. Idiots pumping the DOW on false hopes and imagined solutions proves nothing. You say money is moving again. FALSE. Money is NOT moving again. Liquidity is as jammed up as it has been.
I can't say if RTC II, the Sequel will fix the crisis or delay the depression. I just don't know. Yes, the announcement has calmed the masses and served its immediate function which was to restore confidence in the PONZI scheme and prevent a world-wide bank run.
That is where we are and only where we are. Travis McGee and politickit are apparently convinced that deflationary GD II, the Sequel™ is inevitable and all attempts to prevent it are counterproductive. I am giving this plan some hope but only if the costs can stay under $3 or $4 trillion, also assuming that credit continues to be destroyed at a rapid, but controlled rate that does not create a panic. The inflation will be painful but not as painful to most working slobs as GD II™, the Sequel would be.
Don't be fooled by a two-day ass-blast on the DOW at a time when people can't even short the market and the shorts are covering their positions anyway. We've seen plenty of dead cat bounces and bear market rallies that proved short-lived and later broke support. The liquidity crisis is still fully dangerous and money is not flowing well at all. The markets will plunge and confidence is shaken very severely. There is a great flight to safety and a lot of people are going to sit on the sidelines cautiously before jumping back in. Don't be fooled by a single two-day ramp on the DOW. You will regret it.