The Market Remedy

The major indexes were down at least 5% today bring them down to the lowest level we have seen in many years. No one is really sure what is going to happen next. Personally I thought we would see more resistance when the Dow broke below 8000, but the selling continued throughout the day. If we are to get out of this mess we need to start fixing the problem areas of the economy. Housing, housing, housing! I get sick of all this talk about the auto industry when we need to consider solving the problem of foreclosures. This is trickling down to the banks which is freezing financing which leads to higher loan rates for consumers which leads to less spending on things like autos. Liquidity in the market for MBS related products is non-existent which is causing distress in the financial sector. TARP was signed into law to hopefully combat this liquidity problem but now it has been announced that TARP is on hold. Why make all the fuss for the bill and then not follow through? I just don't get it and now we have Congress basically just waiting until the next year when they will be able to pass legislature to their liking. Market intervention is the preferred avenue to correcting the economy, but maybe we should just sit back and pass the steering wheel to the Adam Smith.