clipped from: www.reuters.com WASHINGTON (Reuters) - Nobel-prize winning economist Paul Krugman said in remarks published on Monday that the latest U.S. Treasury bailout program is nearly certain to fail, triggering a sense of personal despair.
"But the fact is that financial executives literally bet their banks on the belief that there was no housing bubble, and the related belief that unprecedented levels of household debt were no problem. They lost that bet. And no amount of financial hocus-pocus -- for that is what the Geithner plan amounts to -- will change that fact," Krugman wrote.
Time is running out on the Obama administration to take control of the banks - and the crisis.
"This isn't really about letting markets work. It's just an indirect, disguised way to subsidize purchases of bad assets," he added.
The White House strongly disagreed with Krugman's assessment, defending the administration plans on the morning talk shows.