Bank Announcements

There were a lot of announcements by banks today. The Treasury Department made some announcements how it plans to begin the bailout, which is pretty much in accord with what the bill states. European leaders announced an aggregate $2.3 trillion rescue package for the banks, where each country pledged a certain amount to its own banking system. The actual money has yet to be appropriated. Bernanke pledged as many U.S. dollars as foreign banks want. I'm not wholly sure of the significance of this but will keep eyes peeled for financial analysis of its relevance. Market traders were not disheartened by the news today.

UPDATE: it seems the Treasury Department is moving away from the idea of exchanging toxic securities for Treasury bonds, and toward purchasing preferred stock in banks. Both hand taxpayer money to the banks who created this mess; however the preferred stock might hold value better than securities. The whole idea of "free market" in the financial industry is such a laughable notion by now that I don't find nationalization of the banks particularly troubling. So who knows... this change of policy still fits to the letter if maybe not quite the spirit of the $700 bailout bill.

Otherwise there is a mystery brewing as to why U.S. dollars are in such urgent demand in Europe.