If we're going to be capitalistic, apply Bagehot's dictum (from 1873) "in times of financial crisis central banks should lend freely to solvent depository institutions, yet only against sound collateral and at interest rates high enough to dissuade those borrowers that are not genuinely in need" [0]
I feel like, jail or no, the financial executives who got us into the mess - and who haven't really gotten us out yet - ought to be former financial executives that are working as, e.g., baristas.
Instead, a decision was made that the bloated mortgages that had been issued, would be turned from bad collateral into 'sound collateral', keeping asset prices high. It's like resolving Ford's problems with exploding gas tanks back in the 70's by arranging to buy all the bad cars.
If you're seeking to broaden your perspective, you might find "Bagehot's Dictum in Practice: Formulating and Implementing Policies to Combat the Financial Crisis", written by a director at the Fed, to be worth your time.
I feel like, jail or no, the financial executives who got us into the mess - and who haven't really gotten us out yet - ought to be former financial executives that are working as, e.g., baristas.
Instead, a decision was made that the bloated mortgages that had been issued, would be turned from bad collateral into 'sound collateral', keeping asset prices high. It's like resolving Ford's problems with exploding gas tanks back in the 70's by arranging to buy all the bad cars.
[0] https://en.wikipedia.org/wiki/Walter_Bagehot