Bank of America Asks Congress for a $739 Billion Bank Bailout

Mish roundly condemns those "summer capitalists" as they want a socialist solution to a capitalist fuck-up as Bank of America Asks Congress for a $739 Billion Bank Bailout:

Supporters contend that a government rescue could be the fastest and cleanest way to force banks and investors to book their losses from bad mortgages — a painful but essential first step toward stabilizing the housing market.

My comment: Those supporters are socialist fools.

Mish's prescription is to let the market set the true value of the houses and let the financial institutions take the losses. This is to avoid the moral hazard of propping bad lending practices.

What is overlooked here is the question of whether housing is a social good available to everybody, or a commodity to be traded. Until we decide what housing is, we cannot decide on a solution.

This ambiguity about housing gives rise to crises like the current one.