Paulson, Bernanke, and congressional leaders (most importantly, Barney Frank) thought the best way to restore confidence was to buy troubled assets through what would become the Troubled Asset Relief Program. They could have pursued nationalizing the banks, but there was no precedent for it in the US, and when banks were nationalized in other countries, they were penalized with harsh terms. For that reason, banks were reluctant to accept capital and nationalization until just before or immediately after they failed. Paulson did not believe this was the way to go, because it would be more
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