ON GETTING THINGS STARTED

HERE WE GO

Looks like the markets Monday liked the prospect of governments here and abroad, moving in a somewhat coordinated manner, to invest state funds in their national banks and provide other inter-bank guarantees. 

Today's record-breaking move (up 11% for a change), in our markets was certainly a respite from the relentless downward moves of the last few days.  But one can not assume that we're out of the woods...far from it, and continued volatility and uncertainty will be with us for some time to come.

Watching the evolution of the Treasury and Fed's bailout program since it became law a few days ago has been interesting to say the least. 

As the FT reminds us, it's breathtaking how fast the main thrust of the plan has shifted from putting $700 billion to work buying up "toxic" assets owned by financial institutions, to investing hundreds of billions of dollars directly in a large number of U.S. banks and other institutions.

As a long-time student of early stage startups, this whole process resembles how the business plans of so many start-ups change radically once they're out in the "real world"*. 

Even it's 35-year old "CEO", Treasury honcho Neel Kashkari, looks like the type of young, energetic, go-getter that would have lead a start-up in Silicon Valley in another life.  It turns out he even has an IT (Information Technology) background at NASA and later at Goldman Sachs.

Thus we now have one of the largest government funded bailout "start-up" in our history.

Of course, the similarities end there, with this enterprise having all the trappings of a traditional, long-term politically motivated government program, complete with a mind-numbing list of procedures, rules, and execution time-tables, with multiple masters all over-seeing this enterprise with a microscope.

Here's hoping there's a win-win exit down the road for all the stake-holders involved for this little ambitious start-up.

* image source.

Comments

[Alex Tolley]

I suspect it is less like a start up and more like a management buyout using junk debt.

But I am pleased that we are moving in a better direction that when we started with the "Save Goldm...err... Wall St...err...Main Street plan". ;)