tag:blogger.com,1999:blog-3782644139927778760.post-61963151790643385032008-03-25T04:53:00.000-04:002008-03-25T04:53:00.000-04:00The NYT article seems to ignore the fact that the discount window as 'de facto' opened to BSC via its clearing bank, JPM. But then what do you expect from the newspaper of Whitewater, Wen Ho Lee and Judith Miller?<BR/><BR/>More importantly, the FED action signals a major shift in that government bailouts now extend to bond holders. All prior 'nationalizations' (Continential Illinois, the S&Ls in the '80s and '90s) involved sending shareholder equity to 0 and reducing bond holders close to 0 while protecting all depositors.<BR/><BR/>Now, our government will bend any rule, spare no expense, to protect bond holders (and derivative counterparties) of banks and selected broker dealers.<BR/><BR/>Financial institution debt is now apparently <I>parri passu</I> with U. S. Treasury debt.TallIndianhttp://www.blogger.com/profile/11804493195815876399noreply@blogger.com