a) It will remove focus of banks from survival to lending. Most of the banks are more concerned at buffering up there balance sheets and are not looking at lending.
b) Private investors have already burnt their fingers in trying to take stakes in these banks.
c) Pumping more and more money at the problem is not going to solve the problem. Only create more problems later.
The main grouse against nationalisation i could perceive are
a) US is a capitalist country where market is supreme. This is a funny statement in the face of protectionist measures being taken by US.
b) The government does not know business. In the current scenario, private investors have not glorified themselves. The government cannot do worse than them.
The continued dethering is only going to make matters worse. As i said earlier, the quickest way out of the mess would be for US to start exporting and Asian economies to start stimulating domestic consumption. It would mean fall in dollar and a "Default" by US on its payments.
