One of the interesting sideshows that has been going on in the business world has been the debate over whether or not GM should declare bankruptcy. Mark Roe, writing for The Wall Street Journal, argued on Monday that GM would be better off with bankruptcy restructure:
There are other reasons why a Chapter 11 resolution may be the best solution for GM. Bankruptcy may be the only way for GM to fully confront its operational problems, deal with its legacy costs, reconfigure its dealer network, and achieve a viable labor agreement.
But one issue that has not been discussed much is that …read more

One of the big questions that many people — including myself on CNN Money — have been asking is this one: How much would we get if the bailout went to taxpayers instead of banks?

The New York Times is reporting that the government is requesting $700 billion to bailout Wall Street.
Naturally this means that the national deficit ceiling is going to rise. (Is there any reason we have a ceiling?) And taxpayers are on the hook.
I just hope they use some of the money to do something useful – like build infrastructure. But I doubt it.

The U.S. government is planning to put Fannie Mae and Freddie Mac under conservatorship (thanks, markzero, for putting me on to this). This means that, unlike the takeover at Bear Stearns, the government is straight taking over the ailing mortgage lenders, rather than merely guaranteeing the transaction. Any losses that come from Fannie and Freddie will have to be completely absorbed by the taxpayers now. And the investors in the two companies probably won’t even get the nominal compensation the Bear Stearns investors received.
Of course, it’s kind of a necessity at this point. After all, with Fannie and Freddie responsible …read more