I think it’s pretty simple, but I’m just a simple guy.
The government is never going to bail out the people. They may bail out any of the big banks that may have exposure and dress it up like its a people bail out.
There is good history of this happening through the IMF lending to third world country’s where we bail out the defaulting country but payment must be made immediately with the proceeds to the lender (U.S. bank), who then gives them a new loan.
The lenders themselves may try and prolong the agony but in the end the market will win out and the excessive crazy financing will get purged. Anything beyond that is noise IMO.
However its one more reason to own gold. If they try and monetize fanny’s and freddies debt that will be just one more reason in a parade of reasons for the dollars decline.
