You must love how an amorphous 'breaking news' story popping up on CNBC (or CNBS as I call it) about how the strapped U.S. Gov't had broken plans to design a "RTC-like" entity to "buy up the bad debts on the balance sheets of banks" the country over, and how this would allow those banks to begin "lending to businesses and consumers again," sparked a afternoon rally in equities. Has anyone truly stopped to think about how much bullshit this story contains? It contains so much bullshit that it's nonsensical on its face. Even if you assume the story line is true - How will it be to the benefit of banks saddled with toxic paper to have the U.S. Government give them "pennies on the dollar" for such paper? Most of these instruments are commercial and residential mortgages or development loans that are in default. The bank loaned out money based on likely inflated appraisals done during the bubble-manic times, which means that they would be lucky to recoup 1/10th of their capital outlay from the government - even if there were such a plan. How the hell will taking a 90% or greater haircut on their capital restore confidence and the ability to lend money to these banks that are now under siege and drowning in their own toxic sludge? On a practical level, any such plan would involve sums of money 100x larger than what was involved in the S&L crisis. THE FACE OF THE STORY DOESN'T EVEN MAKE SENSE. TRADE ACCORDINGLY.