Thursday, October 30, 2008

Strike 1 on the Financial Bail-out

News this morning that half the banks taking the government life preserver are continuing to pay dividends. This is insane. Dividends are something healthy companies pay. Companies in trouble retain their earnings, pay down their debt and become solvent. It is hard to believe that European banks were required to no post dividends if participating in their version of a bailout, but our banks were allowed to continue to. Word from Treasury is that allowing them to post dividends was an incentive to participate.....how about not failing as sufficient incentive? This is troubling.

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