Merry Bankermas And A Bailout New Year

Bloomberg's David Reilly takes a look at Barney Frank's House financial reform bill, and determines that the banks should be gleefully rushing to make sure it gets passed. (emphasis mine):

Here are some of the nuggets I gleaned from days spent reading Frank’s handiwork:

-- For all its heft, the bill doesn’t once mention the words “too-big-to-fail,” the main issue confronting the financial system. Admitting you have a problem, as any 12- stepper knows, is the crucial first step toward recovery.

-- Instead, it supports the biggest banks. It authorizes Federal Reserve banks to provide as much as $4 trillion in emergency funding the next time Wall Street crashes. So much for “no-more-bailouts” talk. That is more than twice what the Fed pumped into markets this time around. The size of the fund makes the bribes in the Senate’s health-care bill look minuscule.

-- Oh, hold on, the Federal Reserve and Treasury Secretary can’t authorize these funds unless “there is at least a 99 percent likelihood that all funds and interest will be paid back.” Too bad the same models used to foresee the housing meltdown probably will be used to predict this likelihood as well.

Hooray!  The next bailout will be twice as much!

And of course there will be a "the next bailout".  You're paying for it.  That's being arranged ahead of time.  This is the lesson Congress has taken away from the bailouts:  they need to have legislation in place ahead of time to give the banks trillions.