Politics and Money

[properlynumb]

Paulson and the Bush Administration did provide the money.
That was in 2008.
The bailout is about money, cash.
But Banks have/had a major detriment to their ledger:
The assets they have/had are the substance that they loan against.
Example:
If I get a mortgage:
I get a payment book and a residence,
The Bank gets an asset that they can borrow and lend against.
The Bank can lend money with the mortgage (my mortgage).
It's called 'the fractional banking system'.
The bank can lend 90% of my mortgage they hold as an asset.

In 2008 the accounting assessment of this mortgage was 'mark to market'.
This confined the assets of banks to the value of the mortgage as if it were to be sold at that time.
Since all home value was destroyed by about 30% (modestly) at that time,
the assets of the bank were reduced and the loans banks made were unsupported.
In other words.....
The banks couldn't reconcile the books.

Summers, Geithner and Obama voided the 'Mark-to-Market' restrictions.
http://www.time.com/time/business/article/0,8599,1884290,00.html

Sure, Obama didn't bail-out the banks ......
He just allowed them to cook the books.