Don't be surprised if the cure conjured up by Washington fails to solve the market's woes.
The proposed bailout of the world's financial system isn't really about money,
folks. It's about psychology. In fact, you can think of it as the most expensive
piece of psychotherapy in the history of the world.
The idea is that having Uncle Sam buy tons of trashy, hard-to-value financial
assets will change the psychology of lending institutions throughout the world.
This financial Prozac, as it were, would cure the lenders of their fear and
depression, encourage them to start lending again, and induce investors to pump
new capital into these capital-short institutions.
That's why I wouldn't bet the farm on this bailout working as planned.
And let's not forget that there's a long-term psychological cost to this fix: It
has enraged ordinary taxpayers-and rightly so.
That loss, in fact, may be the bailout's biggest cost of all.
clipped from: money.cnn.com