At last wisdom seems to dawn!

One of the news that made me feel better today is this news:
U.S. backs away from plan to buy bad assets (http://www.reuters.com/article/newsOne/idUSTRE4AB7P820081113)

If you have been following the $700b package launched by Bush admin, which planned to buy troubled assets (TARP) - a move very widely critized by many analysts. Today's news article goes like this "Treasury's Henry Paulson officially abandoned plans to buy troubled assets through the Troubled Assets Relief Program. Instead, the government will continue to pump money directly into financial institutions. Paulson said the program will also begin to focus on consumer credit by trying to increase the availability of student loans, auto loans and credit cards, and will examine ways to prevent foreclosures."

To simplify things lets assume we have the same situation in India and for argument sake lets assume that you have lost your job, unable to pay the mortgages and hence lost your house and car.

I am probably holding $700b package in my hands and have the power to influence on this situation in a +ve way then what decision do i take?

1. Do i go and buy your house & Car?
2. Do i support you with loans, jobs, easy availability of credit so that you can stand up on your feet and reclaim the assets?

The answer is very simple even to a person with average intelligence like me.

This is the decision that has been taken. Refer to my blog (Fiscally prudent American *..) where i would have emphasised this point and world over there was hue and cry over the decision to buy TA.

In fact Gordon brown went on record to say that our program is better than US TARP program since we are not buying bad assets.

Its a simple and logical decision but still expecting one such from Bush's team is difficult and being over optimistic. Probably in the last 8 years if one strategic policy has been reviewed and corrected this is one of them.

A dying light burns bright and lo! the wisdom has dawned now for this team.

Still i felt better after reading the news and hence the early morning blog.

Yours fiscally

Happy reading!