The current approach to the banking bailout is distinctly WOBW – worst of both worlds. Somehow nationalization has been deemed not an option. So we keep running bankrupt banks as private enterprises governed by existing equity holders with all the wrong incentives (worst of private). That in turn necessitates having to regulate operational details such as compensation and lending practices with crude across the board measures such as $500K salary cap (worst of public). The only way to get inc...

The current approach to the banking bailout is distinctly WOBW – worst of both worlds. Somehow nationalization has been deemed not an option. So we keep running bankrupt banks as private enterprises governed by existing equity holders with all the wrong incentives (worst of private). That in turn necessitates having to regulate operational details such as compensation and lending practices with crude across the board measures such as $500K salary cap (worst of public). The only way to get inc...