The mother of all bailouts?

There are top-level negotiations going on in Washington about a massive bailout of financial institutions that are carrying bad mortgage debt on their books, similar to what was done during the 1989 savings and loan crisis. (This would be far larger, though, we're talking *trillions* of dollars.)

I don't feel like I have enough information or macroeconomic expertise to know whether such a move would be a good move or not, but it would be a monumental step for America. I hope Bernanke, Paulson, and company know what they are doing. :-/

UPDATE

The Feds are talking about taking the problematic mortgage securities off the balance sheets of banks and other financial institutions that are struggling; a new agency would be set up and would re-sell those securities over some period of time.

With the pressure off, banks could go back to normal lending.

It just occurred to me what this reminds me of: have you ever juggled a number of credit cards with balances and unpleasantly high interest rates? And then solved the problem by consolidating all of your balances on one low interest rate card? And then... gone off and charged a bunch more on the original cards, ending up in a worse situation than when you started?

Hmm.