Why the bailout has not lifted confidence

We've seen some amazing government moves in the last few days: the bailout plan; the decision to directly buy short-term commercial paper from companies; the decision to provide yet more liquidity to prop up AIG's securities lending business. And yet, where is the shot of confidence that regulators and others were hoping for? William Isaac, former FDIC chairman, weighs in with a column in TheDeal.com. He argues that the FDIC has the authority to declare an emergency if the Treasury requests it. "If an emergency is declared, the FDIC could announce that until the crisis abates, all depositors and other general creditors will be protected if an FDIC-insured bank fails." Europe has moved in this direction. He would also suspend fair-value accounting and aid homeowners struggling mortgages. Would any of this help?

For more:
- here's the column

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