Reply #53: Due Diligence. How Quaint.

[SanchoPanza]

Galbraith pretty much underscores the need for proper asset valuation. Why Fed/Treasury keeps dithering about on this is really beyond my ken. Part of me suspects that they and the FDIC don't have the financing or the personnel to do it. But if that's the case, the prospect of them managing this new plan without allowing systemic moral hazard to result from all these non-recourse loans to hedge fund shops goes from being very unnerving to inducing a sweat-drenched night terror.

I understand why the private parties involved don't want it. These folks built their inflatable fortunes by passing astronomical amounts of risk on to other people. It makes sense for them to avoid any public assessment of their billion dollar pyramid scheme.