There is a fatal flaw that occurred early on during the financial meltdown that helps explain why the economy remains in a stall. This slow pace has never happened before, but it is now -- and the suffering and anger are rising to the top.
Today banking regulators have ordered banks to keep their assets high enough to cover the bad loans they made in the lead-up to the meltdown. The result: commercial banks will not lend as remaining toxic debt has been allowed to metastasize throughout the entire industry. Instead of cleansing the bad assets via an RTC model, this lingering, widespread financial cancer is slowly killing the recovery.
http://www.americanthinker.com/2011/06/the_fatal_flaw_crippling_recovery.html
The author seems to think that an RTC solution will solve the nations ills - but that is just code for a bailout - nationalizing the toxic assets that will never show a return value at the expense of the taxpayers. He is right though, about the banks reluctance to lend until their bad assets are cleaned up or sufficiently diluted by good assets and liquid reserves.
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