Moral hazard versus bail out

That's the decision which is being balanced. The ideal move would be to let the market enforce the pedagogy of punishing the banks that made the foolishness of lending money to subprime borrowers. But reality prevails over ideals and the move had, and will continue to be - until crash do us part -, to cautiously bail the banks, and indirectly the hedge funds that should receive the "moral hazard".

The problem now is that the financial markets and the "real economy" are, completely and immediately, interconnected and the real economy suffers with its upturns and downturns. I don't ignore the lessons this crisis permits but, for the time being, the priority, for Bernanke and the bunch (and Bill the Butcher also...) is to sustain the market. I think Jim Cramer's alert was fundamental to ignite an answer from the FED.