I don't have time to analyze this yet, but it looks like our friends at Goldman Sachs are up to their old tricks:

Investment banks, including Goldman Sachs and Barclays Capital, are inventing schemes to reduce the capital cost of risky assets on banks’ balance sheets, in the latest sign that financial market innovation is far from dead.

The schemes, which Goldman insiders refer to as “insurance” and BarCap calls “smart securitisation”, use different mechanisms to achieve the same goal: cutting capital costs by up to half in some cases, at the same time as regulators are threatening to force banks to increase their capital requirements.

So, after figuring out that his original plan wasn't going to work, Hank Paulson has now decided to reward his Wall Street buddies with a "capital infusion" in nine big banks -- most of which are located in New York City, and all of which have large divisions or subsidiaries that act very much like "brokerage firms".

Not only does this reward bad behavior by the people responsible for this crisis, the likely consequences of this move are pretty horrible.

I'm not really joking. The banking crisis is rapidly getting, how do they say? "Out of hand." These idiots in charge have long since proven they aren't capable of dealing with Reality, when it gets ugly (cf Katrina, Iraq, Georgia, etc.) So: what are you doing to prepare?

I've put down ~75 quarts of homegrown, so far. There's more I know I should do. Ideas? I'm not the only one asking.