TAILIEUCHUNG - A Failure of Capitalism: The Crisis of '08 and the Descent into Depression_12

Tham khảo tài liệu 'a failure of capitalism: the crisis of '08 and the descent into depression_12', tài chính - ngân hàng, ngân hàng - tín dụng phục vụ nhu cầu học tập, nghiên cứu và làm việc hiệu quả | Apportioning ỈMame cial firm could go broke so anv such firm would be reckless if it lent a significant portion of the bailout money that it received rather than holding it in cash or cash equivalents such as Treasury bills. The failure to save Lehman had another consequence which assumed growing significance in the months that followed. It shook confidence in the government s management of the crisis as did the stumble over the 700 billion bailout and later the government s waffling about an auto bailout-first denying that any part of the 700 billion bailout fund could lawfully be used to save a nonfinan-cial company and then deciding after Congress voted down an auto bailout bill that it could give some of the bailout money to the automakers after all without congressional authorization. This about-face undermined Bernanke s and Paulson s claim that they had lacked the legal authority to bail out Lehman. If they could lawfully bail out insolvent auto manufacturers they could lawfully have bailed out an insolvent investment bank. It became increasingly obvious that the government had no game plan that it was lurching from crisis to crisis in a desperate effort to arrest the decline. Business requires a reasonably stable political environment. Because the bailout program was 277 A Failure of Capitalism completely ad hoc banks did not know where they stood. Private recapitalization of the banks was made impossible by uncertainty. Who in his right mind would invest in a bank without knowing what the government would do if the bank got into trouble What banker would be fool enough to lend the capital his bank received from the government without knowing whether the government would give the bank more capital when borrowers defaulted on their loans Never having dreamed that it might be necessary to recapitalize the banking industry the Federal Reserve and the Treasury Department had no plan for recapitalization which meant among other things that when Paulson and his .

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