Compromise
It seems almost certain that a bill will get passed by weeks end. My guess is that it will ostensibly be the original Paulson plan with a relatively minor tweak or two. Increasing the FDIC insured deposit limit to $250,000 might be the compromise that secures the necessary votes. Given the fallout resulting from the massive market decline on 9/29, many who voted no appear to be looking for some political cover. The FDIC measure would enable them to tell their constituents that they secured something tangible for them in the new package. The current FDIC insurance limit of $100,000 has needed to be raised for quite some time. That said, its potential inclusion in the bailout bill does virtually nothing to solve the immediate problems of tight credit and sharply declining home prices and excessive inventory.


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