It’s All About the Capital – or Lack There Of

Ok here is the problem. Many, many large financial institutions in this country need capital and no one wants to give it to them. Big problem. For Fannie and Freddie only the US Government could do it, but for Lehman and WAMU and AIG and and… anyone can but no one wants to. If they cannot raise capital then they will go under, and thus it is up to the US Government to decide if they pose too great of a risk to the financial system if they fail in which case, as in the case of BEAR, they would step in. It is simply unbelievable how quickly the wheels are coming off the bus.

My best wishes go out to the many people who are innocent bystanders to all this and have had their savings evaporate because of it.

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