Here’s some insightful comments from Thomas Haynes, a friend of CEI’s:
There’s a very interesting debate that could be conducted on who’s the madam, who’s the john and who’s the pimp in the relationships between the executive branch, the legislative branch and the financial services industry, but only so much of that debate can take place on Internet.
I did, however, want to note to those involved in the debate over TARP that my experience as a borrrower, plus some candid…
It will actually divert money to the Treasury from commercial lending. Naked Capitalism has more, concluding:
When Paulson dumps out his 700 billion in treasuries it’s going to be at the short end. That will drive up rates for short-term treasuries. This will obviously draw even *more* deposits into the treasury MMs. That means even less in the commercial MMs and thus less working credit, the eventual commercial MM product. Hence Paulson’s billions remove working capital by competing for the deposits that…
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