Archive for February 26th, 2009

A Zombie bank is like the heroine in the Cinderella story: of course if she did not have a prince Charming to come to her rescue she would have been living among the cinder and under the thumb of her step-mother. Zombie banks that I am speaking of, have the Federal Deposit Insurance Corporation for a stepmother. What FDIC does in her infinite wisdom?  She seizes banks like the helpless heroine of the fairy tale, and cleans her up a little (takes of her bad assets, pays off some of its debts and sells her off to two step sisters who are private investors. Do you think these step sisters will be genuinely concerned about her finding her Prince Charming? So Cinderella needs a fairy godmother. This is what nationalisation would do.
We all have a stake in the outcome of Cinderella. We are rooting for her to get out of that hell hole and from under the iron fist of the step sisters who would sell even their mother if that would give them a little profit. Imagine how the story of Cinderella would end as an anti-climax if the step sisters got their permanent entry into the palace and the Prince’s bed room for keeps? Cinderella is a story that is well beloved because it shows triumph of the good over evil through an external agency. Besides the story is well plotted.
Zombie banks similarly require the interference,  of deux ex machina, in the form of nationalisation.


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