[beojan]

Bailing them out is OK, but it should be through the government buying equity in those companies (essentially partial or complete nationalization).

[nordsieck]

> Bailing them out is OK, but it should be through the government buying equity in those companies (essentially partial or complete nationalization).

Additionally, I think the government should be buying equity at a steep discount - something reasonable but not disastrous like 67%.

[chii]

> buying equity at a steep discount

the gov't "loans" should be the same as the amount of equity obtained. For example, if the book value of the company is $100 , and the debt is $80 (so they need a loan of $80 to cover their debts), then the bailout will dilute all existing shareholders 80%.

[beojan]

If the company is on the brink of bankruptcy, its stock is going to be close to worthless anyway.