Just as you know, the government has been supporting banks over the past few weeks, still this tendence is about to change...
It's back to square one.
The deepening financial crisis, which is undermining the government's rescue efforts so far, is prompting federal officials to revisit its original bailout measures. These include taking toxic assets off institutions' balance sheets by moving them into a so-called "bad bank", according to published reports.
As long as these assets remain on banks' books, there's no telling how long their losses will continue and how deep they will be.
Addressing these assets was the original purpose of the Troubled Asset Relief Program, the formal name of the $700 billion bailout plan the Bush administration unveiled as the credit crunch spun out of control. It was later abandoned in favor of taking equity stakes in banks, which was seen as a more direct and rapid way to help.
But as the economy worsens and banks continue to rack up multi-billion dollar losses, the incoming Obama administration will face tough choices in deciding what to do with the $350 billion remaining in the bailout plan. There are many who want a piece of the pie, and there may not be enough money to go around.
