Mr Paulson's bail-out bill includes the suspension of mark-to-market rules.
Which seems to mean that instead of having to say "may assets are worth what I can sell them for today" I can say "my assets are worth what I want them to be worth" or "my assets are worth what they were worth before they became worthless" or "my assets are worth what I think they might be worth one day, once they have ceased to be worthless".
Which is a bit of a boo if my assets really do have a useful market value: dodgy institutions can now pretend to be as sound as I am and the risks of lending to anyone therefore increase, which cannot help in a liquidity crisis.
I give up. I don't understand anything any more.
I will pour myself a very large whisky, settle down in my club chair, and laugh heartily as the Laws of Gresham, Unintended Consequences*, Murphy and so on inexorably work out their effects.
I recall that the Bank of England once prevented a run by having its liveried footmen deliver boxes of gold at the front door - under the eyes of the panicking depositors - then scamper round the back and deliver the same boxes again. Maybe a similar kind of swindle will work after all.
1) The Irish Government guarantees Irish bank deposits;
2) lots of people send their money to Ireland;
3) to the extent that the Irish Government cannot possibly afford to guarantee the deposits.