There is more on the use of bailout funds in today's AP press. Banks are apparently using the capital investment funds to purchase other banks. At least a partial purpose for these acquisitons was mentioned to ease the possible need for Federal takover of weaker banks and to strenghten the overall banking system.

This may be a good policy goal, although it looks more like government is now in the business of determining which banks will win out and which banks will lose.

To me it just seems like more indication that the bailout lacks direction and its effectiveness may very well be lessened  as a result.

It may be that the markets are not responding well and quickly in part because the bailout is not restoring markets, it is not helping stabilize housing, assisting struggling home owners, reducing foreclosure trends, rewriting high interest rate adjustable loans, buying back defaulted mortgage, or even making new loans.

None of the intended use of the funds that I read said anything about helping big banks get bigger.

I would love to hear your comments.