What should be in the bill: - 400-500 billion USD, all of which goes to the Fed. -Fed reduces rates on Discount Window through which it loans out the 400-500 billion. Special discount window rate of 1.0% active for 24 months. -Mortgages that are in MBS tranches get adjusted to Prime+1.0% for 24 months. -Fed raises Prime by 0.5% immediately -Fed regulators are given (Edit: temporary, proxied by congress) subpoena power and focus on tracing MBS tranches to lenders that committed fraud. Not perfect, but a better solution then the current bailout bill.
It is crazy, but it makes the holders of those tranches live with them, instead of pawning them off on the govt. It's crazy only in its elegance, which is why it would never be brought up for a vote.
for instance Altria received $7 billion in financing from Goldman Sachs & Co. and JPMorgan Chase & Co. (UST purchase)