S&P Lowers WaMu To Junk Status

Still no deal on AIG, WaMu now on the brink.

But John McCain says the economy is sound, so don’t worry.


UPDATE: Maybe someone who’s got a degree in economics and is ordained in the pseudo-faith of the free market can explain this to me, since I don’t get it.

Couldn’t this whole mess been averted by simply bailing out the people who owned the houses? Work out a system where they can pay what they can pay and then cover the difference.

No lost homes… but, erm, more importantly (snark) there would be less defaults and then less bad debt, then less bank failures, and you know, not all this mess.

I mean, ok. Explain it to me without telling me it’s communist or something. Tell me why, in actual practice, it wouldn’t work, without moralizing (ha).