What’s the one thing that could make the bailout fail? Okay, there are lots of things, but there is one thing that all but guarantees the bailout’s failure, and that is that the banks will not lend the money out. And that is exactly what is happening right now.
It’s such a big problem, in fact, that the White House has told them to start lending out that money, but really, why should they? What incentive do they have to lend that money? Already people cannot pay their bills, that includes individuals/small businesses/and corporations. How can they be expected to pay off new debt? They can’t, and that is why banks are giving out the money. They are doing what banks do best, hoarding, and they will continue to hoard until the financial landscape looks better. Of course, it won’t look better until they start lending. Classic Catch-22, and all the more reason why the government should have given the money to the people, rather than to corporations (that is, if they were going to give the money away, anyway–and they were, obviously, because they did).
So the banks now have the money that they so needed to stop the credit freeze. The freeze is still in efffect and the banks still have the money. Washingtons is calling for them to lend that money out, and in the meantime tens of millions of Americans are wondering how they will afford their next meal, car/house payment, electric bill.
How long will this last, and when will it be too late to repair the damage caused by irresponisble corporate leadership coupled with irresponsible governmental leadership?