A ponzi scheme that would make Charles Ponzi blush.

If socialism is the ideology of redistributing the wealth from the few to the many - then Obama can be called a kind backward socialist. The Obama banking plan takes the debt of the few and makes it the debt of the many. James Galibriath, who carries an intellect and pedigree that few can match, said this: The plan is extremely dangerous.

The massive debt the banks are now holding will be transferred to you and me and everyone we know, and for that matter, every American we don't know. Even Charles Ponzi would not have the balls to try a stunt like this.

I see no real reason to believe that banks will start making bad loans again. That is what fueled the economy for the past 7 years. That is not coming back. All of us need to ingest that little nugget. The era of easy credit is - and should be - over.

Do I think Geithner is a bad man? No. But this cannot be stated enough: Obama, after slapping us silly with "hope and change" for over a year, went out and hired the people who created the problem to be his closest economic advisers. They were never going to come to a solution that punished the bad players (the bankers who bought this crap) and saved the innocent (most of us, who did not take out sub prime mortgages on houses we could not afford) from all but the most unavoidable damage.

My sense is that Obama and his team think this is a good and fair plan. In the culture that these men move in - this "corporate socialism" seems equatable. They are financiers - committed to the idea that THEY run the world. If they are safe - all will work out for the rest of us. Another trillion in debt lathered on top of the "little people" is a small price to pay. The financiers will get back to lending, and the wealth will roll out...in other words the ponzi scheme that has been the American economy since the 1970s will kick back in. The bankers will inflate another bubble- which will last until November of 2012 - they hope.

Simply because the government (you and me) now owns this mountain of crap does not mean that is is suddenly not a mountain of crap. It is. The difference is that now WE will own it all. The intention is to have us pay 100 cents on the dollar for bundled mortgage feces that is worth 30 cents on the dollar. If that.

The more I read about this, the more I am convinced that the right thing to do was either to nationalize the bad banks for one year, clean them up and rewrite the rules for the entire sector so that never again would any one entity like AIG be able to hold us hostage.

Or to let them fail, and to take our damn cod liver oil. We will have to take it regardless. And now I fear the swallowing will take a generation.

President Chuckle's plan gives the bankers a pass - and passes the pain on to us and our descendants. Anyone who still believes that Obama is anything but an errand boy, sent by grocery clerks, to collect a bill - is in a coma. The bill was presented on Monday.

For further insight please read Orlov's post called Welcome to Fluffland!