Doomed!

Aside from Pieter's very informative response to my question about the profit potential in a bailout, I was recommended an extremely depressing Weiss Research paper that includes the prediction that if the government does purchase assets at a good deal, the selling banks will probably fail anyway:

Many investors have unrealistic hopes and expectations regarding what Washington can accomplish. Even if Congress moves swiftly to enact legislation allowing the government to buy up bad assets, the government is expected to pay far less than face value for them. In that case, banks will continue to suffer losses and fail, uninsured depositors will continue to lose money, and investors will continue to see their shares lose all, or nearly all, their value.

The main claim of that paper is that $700 billion isn't nearly enough to support all the banks and other companies liable to collapse in the near future.