Obama's Wall Street Bank Rescue Stabilized Economy at a Political Cost

When Barack Obama took office, the economy appeared to be on the brink of catastrophe. Despite the previous administrations commitment of several trillion dollars from every available arm of government to prop up the reeling financial system, nothing seemed to have worked. Banks were still hemorrhaging cash, and it was feared some would go down.

In his first weeks, the president was confronted with two courses of action. Some argued that as a consequence of disastrous mortgage investments, there was a good chance large chunks of the banking system were essentially insolvent. To prevent a collapse, the government had to take over some banks and restructure them, firing top management in the process.