Obama has made yet another attempt to deal with the financial crisis in the US, with a complex scheme risking trillions of dollars of taxpayers' money. Taxpayers will become part owners of so-called toxic assets, and investors will have the opportunity of making a profit if they turn out better than expected.
This sounds wrong. Toxic assets consist of bad debts, lent on the security of land which was overpriced due to excessively free lending. This bubble has to be allowed to go down to its right size, and nobody knows what that is. But the more governments interfere, the longer the trouble will continue. This cannot be prevented without causing damage somewhere or other.
It seems to me that people and companies who have lent to people who cannot pay it back, they should be made to write off the debts unconditionally. This seems to be a reasonable price to pay for their bad commercial decisions.
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