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Preview from Europe: Four Day Winning Streak Snapped

There's actually nothing to suggest the equity holders would remain standing in the creation of a bad bank. It's mostly a matter of where the marks are for the assets that are transfered. There's a good chance that that may be the sticking point between the government and management. The govt is suggesting a wipeout of the equity and new management and some of these ego-maniacal brainiacs think they should be left in charge.

I think the important part here is that this won't solve the problem. Congress and the White House are probably just figuring out how bad it really is. The bank rally we saw two days ago was likely short covering, but now that the smoke has cleared, the shorts will be back with a vengeance.