I don’t like where some economic advisers are wanting to take us.

Why don’t we, the people, take this TARP bailout money and start our own bank(s) to provide the short-term credit for corporate entities – this appears to be where the credit logjam is occurring – and let the current financial institutions die? This will provide the capital needed for the economy to run for the near-term and if the new bank(s) is set up right it may be able to address the long-term funding growing corporations need.

We might even be able to get into some consumer credit business as well, but why not leave that to the banks and credit unions that didn’t run themselves into the ground. Once all the current banks that have dug this economic sinkhole  have buried themselves, we can sell our young vibrant bank(s) to investors and recoup our investment.

We don’t need to nationalize the existing banks and get stuck with their toxic wastes. We can start anew and try to do it right.I’m not sure that this approach will help any for the mortgage market, but realistically, people with no income and with a $500K mortgage should default and give the house back to the bank that financed them.

As the commenters in the linked article note, don’t give any money to the folks who created the crisis. Don’t reward bad behaviour.