Excerpt:  Tuesday's deadline to settle an estimated $400 billion in credit default swaps on Lehman Brothers failed to trigger feared havoc in the market, and derivatives analysts said the concerns had reflected misunderstandings about the process. "It seems like a non-event," said Tim Backshall, chief strategist at Credit Derivatives Research in Walnut Creek, California. "There's a couple of hedge fund rumors but I am sure they are more general redemption issues than Lehman specific."

Excerpt:  The Federal Reserve will provide up to $540 billion in loans to help relieve pressure on money-market mutual funds beset by redemptions.

Excerpt:  Argentine bond yields soared above 24 percent and stocks sank the most in a decade as the government proposed a takeover of pension funds, a move analysts said is a bid to seize assets and stave off the second default this decade.

''It's horrible,'' said Jaime Valdivia, who manages $1 billion of assets for Emerging Sovereign Group in New York. ''We're going back to the dark ages. Not even in times of the worst financial stress did the government ever think about taking over the private pension system.''

President Cristina Fernandez de Kirchner has struggled to cover financing needs that have ballooned as the global financial crisis pushed down prices on the country's commodity exports. The government's borrowing needs will swell to as much as $14 billion next year from about $7 billion in 2008, RBC Capital Markets, a Toronto-based unit of Canada's largest bank, said today.

Excerpt:  Paulson's bailout plan reflects a state of denial with regard to this dynamic. The debt overhead is self-aggravating, becoming less and less "solvable" and hence more of a quandary, that is, a problem with no visible solution. At least, no solution acceptable to Wall Street, and hence to Paulson and the Democratic and Republican congressional leaders. The banks and large swaths of the financial sector are broke from having made bad gambles in the belief that money could be made to "work" under conditions that shrink the underlying industrial economy and stifle wage gains, eroding the market for consumer goods. Debt deflation reduces sales and business activity in general, and hence corporate earnings. This depresses stock market and real estate prices, and hence the value of collateral pledged to back the economy's debt overhead. Negative equity leads to bankruptcy and foreclosures.

By increasing America's national debt from $5 trillion earlier this year to $13 trillion in almost a single swoop by taking on junk loans and other bad investments rather than letting them to under as traditionally has occurred in the "cleansing" culmination of business crashes ("cleansing" in the sense of clean slates for debts that cannot reasonably be paid), Paulson's bailout actions increase the interest payments that the government must pay out of taxes or by borrowing (ore printing) yet more money. Someone must pay for bad debts and junk loans that are not wiped off the books. The government is now to take on the roll of debt collector to "make a profit for taxpayers" by going around and kneecapping the economy -- which of course is comprised primarily of the "taxpayers" ostensibly being helped.