2) Paul Krugman likes the Dodd proposal, mostly because it gives Treasury equity in firms it rescues. This is one of my conditions for making the Paulson plan work. I was naive though: left to his own devices it's not clear Paulson would have pursued this. From his "quick and clean" language I doubt it. So I wasn't describing the Paulson Plan after all.
3) James Hamilton, via Brad DeLong
4) Calculated Risk, via James Hamilton
Question: At what point are you screwing the bankers so much--diluting their equity, cancelling compensation arrangements--that they say forget it and refuse to sell you the bad paper, which is the point of the exercise in the first place? Paulson's economist critics may underestimate this.