Hank Paulson and His Wall Street Cronies Move to Plan B

By Nomi Prins, The Nation
Posted on October 15, 2008, Printed on October 15, 2008
http://www.alternet.org/story/103004/

How do you stop a ship from sinking, and simultaneously rebuild it to prevent its future destruction? That was the question in the minds of the world's central bankers as they sat down over the weekend to figure out how to right the global financial Titanic.

European leaders came up with a plan to inject "unlimited short-term funds" into the system in addition to $2.3 trillion of guarantees and various emergency measures (pledged by Germany, Britain, France, The Netherlands, Spain, Portugal and Austria). This could be like dumping money into a black hole, since most of these funds will be given in the form of loans, which means banks must come up with adequate collateral to back them, which is in short supply these days. But it's more decisive than anything the Treasury or Federal Reserve has done so far.