US Financial Sector Near Insolvency?

During a discussion with my Liberal cousin a couple of months ago, I postulated that O’bama and Geitner — while being incompetent and unable to comprehend the factors that actually create wealth — are hiding the facts about bail-out and stimulus for other reasons…. I’m going to go out on a limb and tell you that it’s because the US financial industry is near insolvency.  A recent story in the Wall Street Journal exclaimed nearly the same.

While it’s difficult to get a precise number, an older issue of Realty Times estimates the total value of residential property in the United States exceeds $25 trillion.  If we use a composite 30% reduction in value of these assets over the last year, we’re looking at a paper loss of nearly $8 trillion.   This loss is borne by home-owners and mortgage backers…

Are taxpayers going to be sucked into this ruse of subsidizing the financial sector for “our best interests”?  Are we going to throw more good money after bad, similar to our experience with the recent funding of the auto industry?

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