Meltdown: stock market in free fall


This time it IS different.

In past financial bailouts, the destruction was limited to one or two institutions. A group was put together in the private sector, or the central bank stepped in, and the troubled entity was bailed out.

When the Federal Reserve, the European Central Bank, and Bank of Japan moved last week to bail out the entire financial industry worldwide, they offered, as the Financial Times pointed out today, the equivalent of a credit card with no credit limit and subsidized rates 1 or 2 percent below what would have been the free-market rate had they not stepped in.

What’s more, it was done on a global basis to the tune of hundreds of billions in “liquidity.”

Thus the central banks have set a dangerous precedent . . . .

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