Run around the gym on the new catabolic state

run ranjambo---in telegraphic  paraphrase-- :

we need a mechanism that puts berserk  systemically important firms out of existence

problem
Once a state immortalizes a hi fi firm by endowing it with an open ended credit line
 in the states own self produced money

That firm can't recklessly kill itself off
no matter how incompetent  or inefficient
no matter the red ink it bleeds
no matter what damn fool risks it  takes

So the state has to kill it

And obviously given this outfits systematic position
the kill has to be careful and allow the maximal intact harvesting of it's still vital organs
For transplantation

And if that is fruitless?

 at least release the elemental productive factors for maximally efficient and rapid absorption
into other laputa firms


Including newly spawned. Baby GSEs
And other " state as mid wife" infant or even embryotic  ops

This amounts to a new metabolic sub-system

That has the potential for better dynamics then the private markets acting in there relatively
Groping and overly un co ordinated fashion
No this is not the libertarian paradigm now is it ?
But history has a sublation for capitalism never dreamed of in those lonely geeks philosophy
With potentially

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The innovation of the last epoch ending in September 08
Was the deeper securitization of the credit system and the wondrous complexity
of derivational synthetics
How this shakes out once we pass thru this testing ground oughta be fun to observe
The more completely inter connected our credit system the better
Despite the hazardous passages involved
On we go ready or not
to the higher organization of social production !

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As a veteran
gosplan II fancier
All this dazzled my head these past 25 years or so
Hint
Yearning for The mouse trap of yesterday year is nostalgia
The state is in the midst of the hi fi system to stay
Even when it backs off it only comes back in in a grander more intricate way
Vide the circle we traced these last 30 years

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Then of course we have the reactionary goo goo response
That thinks we can utilize the credit system in some straight forward retro way
And simply legislate an end to the uncertainty
Of spontaneous innovations of problematic social benefit
Fossilized finance.
That would be a virtue if all innovation in the credit system was destructive
That for example there really were no socially improving innovations beyond the ATM
The cult of self assured indignant bismark like reaction built around tall Paul
Is a delightful example of little lost lamb knee jerkism
"Come to me little ones... I'll protect you"
Crunch !