Alternatives to Bailout Plan & More

The bailout plan is on a fast-track, and the legislators are being rushed through. Let's step back and look at it carefully.

A few recommendations that maybe worth considering by all concerned.

The taxpayers should not just be opening up the wallet and giving away a blank check.

America is a capitalist country right, and why not let the marketplace work. Let us not privatize profit, then democratize the risk and losses.

The US Government supports "private enterprise", does it not?

So the alternative to consider is one that delivers "liquidity" and does not take on the "risk".

Alternative:

The government entity, pays banks and other parties that can access its "windows", a payment and takes for "re-sell" on "consignment" - a portion of the "securities" which are not moving easily in the marketplace. This release of funds "unclogs" the financial marketplace and credit markets. Risk of loss is minimized and is still in the hands of the original owners.

The government then classifies, sorts and tabulates these securities and "systematically" on a time-delay basis invites "offers" from smart and informed private players. Since the buyers know that the Government entity can hold on to them instead of having to sell it in a "rush", the right buyers will come along at the right price. This could even be a "reverse auction".

For the taxpayer, this is a far less risky approach. For the legislators, it could be easier to sell and better for all concerned.

Additional steps to regulate the markets are necessary. A marketplace for trading these instruments, CDO's, CDS's, on an exchange. Hedge Funds and others who have speculated "wildly" will have to lick their wounds. Sorry - smart guys!

Another step, why should it not require "speculators" and others to "put up" more than 5% to trade commodities and other financial products. Equity(stock) margins are 25-50% and it should be the same for all players across all exchanges. This will make life a little less volatile.

Comments invited. Spread the word.