At what point does a bailout become a lifeline?  Is there a point anywhere in there that it becomes another bad idea?  The Federal Reserve and Treasury Department got together today and unveiled a new plan to pump upwards of $800 billion more into the struggling US economy.  Their hope is that this will jumpstart lending by banks and that suddenly consumers and small businesses will want to use that money.

These plans are as optimistic as TARP, with the Federal Reserve Bank offering as much as $200 billion to purchase securities backed by consumer debt (credit cards, auto loans, student loans, etc.).  The Treasury will then insure up to $20 billion against losses (is this confusing yet?) and then the Federal Reserve will purchase up to another $500 billion in mortgage backed securities from Fannie Mae, Freddie Mac and Ginnie Mae (lets call them the three stooges).  As if that’s not enough, the Fed will also buy another $100 billion in direct debt issued by those firms.  And that’s it for Tuesday.