Here's a metaphor to consider; think of financial crises as forest fires, easy to start and hard to fight when conditions are right for them. Bailouts act to in

Here's a metaphor to consider; think of financial crises as forest fires, easy to start and hard to fight when conditions are right for them. Bailouts act to increase the fuel load in areas where they apply, so while they solve the immediate problem (you put out todays fire) you are creating conditions to make future fires worse ( more fuel, faster spreading fires, greater damage ). In a very real way, bailouts have allowed vulnerable institutions to survive to make the rest of the economy more vulnerable than it would have been had the banks been allowed to die.