Re: [Pen-l] Short Synthesis of the recent pen'l nationalization debate

[Jim Devine <jdevine03@xxxxxxxxx>]

me:
> FWIW, a lot of the deflation would occur at the public expense [even] if the
> government _doesn't_ take over [the banks], assuming that there's no
> alternative
> government policy: the cut-back in credit, the way in falling asset
> and product prices make previously-taken debts more onerous, etc.

Ann Davis wrote:
> So is this a back-handed argument in favor of nationalization?  Presumably
> the government could manage the deflation better, or at least make the cost
> and distribution of that cost more transparent?

all I was saying is that a deflation would be extremely costly and
that the government (and thus the taxpayers) would end up being forced
to pay many of the bills. This is true whether or not there's
nationalization.  Nationalization simply shifts the burden around.
With luck, it would shift the burden to the banks' stockholders.

-- 
Jim Devine / "Segui il tuo corso, e lascia dir le genti." (Go your own
way and let people talk.) -- Karl, paraphrasing Dante.
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