I Have Some Questions

First off, let me say this. If the weather wasn't gorgeous today, I don't think I'd be able to do what I am doing now. Namely, watching the Mets collapse on Picture-in-Picture while news on the financial crisis/bailout throbs on in the foreground. Both are just mind-blowing. I just read this at Forbes online:

In fact, some of the most basic details, including the $700 billion figure Treasury would use to buy up bad debt, are fuzzy.

"It's not based on any particular data point," a Treasury spokeswoman told Forbes.com Tuesday. "We just wanted to choose a really large number."

Are they kidding? This isn't a beer run we're talking about.

Anyway, I have a few questions about this whole thing:

• If the problem is that nobody knows how much these bundled mortage securities are worth, how do we know they are worth anything? I'm no economist, and I'm certainly no free market cheerleader, but aren't markets supposed to be the most efficient method of pricing? And if thats true, and nobody is buying these securities, hasn't the market set their worth at zero? Why should we not believe the market?
  
• We are apparently going to basically socialize these bad securities, not the companies who hold them. Barclays just bought all the profit-making parts of Lehman Brothers and let the rest go under. Why can't we (the government) do that? Hey there, Mr. CEO, you work for us now. Here's the good news...we are going to make you the highest paid government employee..by one dollar. That's probably like $300,000 a year! Sweet, right?
• What made these bad home loans bad was that people borrowed money for a house they could not afford. If the loans do not get paid back, how do these mortgage securities we are buying become valuable so we can sell them again? And if the homeowner can't pay, are we going to pay for them? Is this going to end up being a back door Homesteading program for the most irresponsible of our society? And if so, how was I overlooked? I'm one of the most irresponsible people I know!
• The "seizing" of the credit markets is supposed to be the big problem here, I guess. "Small businesses, home buyers, car buyers, nobody will be able to get credit" is what they say. Couldn't the government just loan these folks the money for a trillion plus dollars? And if not, are we really supposed to believe that The Market won't solve that problem? I mean, isn't loaning money the good ol' fashioned way all these banks are supposed to make money? I'm still getting credit card offers, so there are at least a few reckless institutions out there.

I don't know. I really do wonder about these things. And when you read that the bill showed up only three pages long and one of the precious few lines in it was one about no oversight and no judicial consequences, it makes you wonder how just how accidental it all is.

Tin foil hat time. Just like my Otober suprise Osama prediction. I'm just trying to cover my bets here....