Sunday, January 25, 2009

OK, President Obama--Let's Get Moving!

I've been reading a lot about the TARP program (giving capital to banks so that they'll lend it out). One commentator today in the Times was saying that the banks aren't using the money to lend any extra; they're just holding onto it in case they have losses and need to boost their capital ratio. As Homer Simpson would say, "Doh!". If you give me some money to buy a present for myself, and, at the same time, warn me that I may have unexpected expenses over the next year, would you be surprised if I didn't spend it?

I think it's time to bring back the "bad bank" concept, used successfully in the late 80s and early 90s with the Resolution Trust Company, and even used in the Great Depression, as the Homeowners' Assistance Corporation. If the government took the rest of the TARP money and "bought", for some number of cents on the dollar, bad assets of the banks, then investors wouldn't be so skittish about investing in banks, stock prices and confidence would go up, and credit might start to flow a little faster. If you remember, those entities came out fine in the end; it just took some number of years to dispose of the troubled assets. We may not even be talking about a permanent loss, just a fix for the peace of mind of bankers and stockholders.

While we're waiting for something to happen, why not see some theater? We saw the world premiere of Athol Fugard's new play at Long Wharf Theatre this week. Coming Home is a beautifully acted, beautifully directed production. Although it's sad, it tugs at the heartstrings in unexpected ways. This makes two stellar premieres in a row for LWT, following the unforgettable Civil War Christmas, by Paula Vogel. I may not be objective on LWT, but I certainly am in the majority on these two shows. Treat yourself--see something warm on a cold night!