It's not a recipe so much as it is unbridled corruption.
Bankers figure out they could take more risks and make more profits if they get some laws change, so they lobby to change the laws, and take lots and lots of risk and make huge profits. Risks fail and now they're in trouble, so they go back to the government and get the money. They got to keep the profits, of course - those are long spent or invested in other things, or paid to individuals.
A homeowner bailout would make the value of existing mortgages more certain. That would definitely be enough to stave off this financial meltdown. It wouldn't save banks from the stuff they've already lost, but nobody's talking about doing that anyway AFAIK. If they are, that's even crazier.
no subject
Bankers figure out they could take more risks and make more profits if they get some laws change, so they lobby to change the laws, and take lots and lots of risk and make huge profits. Risks fail and now they're in trouble, so they go back to the government and get the money. They got to keep the profits, of course - those are long spent or invested in other things, or paid to individuals.
A homeowner bailout would make the value of existing mortgages more certain. That would definitely be enough to stave off this financial meltdown. It wouldn't save banks from the stuff they've already lost, but nobody's talking about doing that anyway AFAIK. If they are, that's even crazier.