Although the Treasury Department's proposed $700-billion rescue plan has been signed into law, all that's certain is that the plan is now reality. How it will play out and, more importantly, how effective it will be in getting the wheels of commerce turning again remain to be seen, as this week's commentator makes clear. Describing the plan on its face is evidently fair game, and 48% of you voted that the bailout sticks it to the American taxpayer. Another 29% said there was no other way to address the problem, while 23% agreed the plan derails any private-sector solution. Spencer Garfield, managing director of Hudson Realty Capital, says the plan accomplishes an important purpose but is no panacea.

"You will not see an immediate effect of the plan being put in place. It will take several months for the plan to start trickling into the system. They have to evaluate and pick asset managers, who may or may not pick third parties to help them. They then have to decide which assets they're going to buy, what the qualifications are to buy them and at what price. They'll need to use some consistency in buying the assets, and then the question becomes who's able to sell to them.

"Once it starts making its way into the system, it will do a couple of things, which I think are equally important. Number one, it will take toxic assets off the books of lenders, freeing up their ability to extend credit. Right now, they're frozen in place, because these assets are holding down their balance sheets. But equally as important is consumer confidence, and by that I mean confidence in general. Whether it's lenders or borrowers, there is just a complete lack of confidence. People don't believe they can borrow money, so they're not willing to sell their houses or look at new ones. Lenders are afraid to lend, because of the lack of activity in the market. So half the battle of this program will be instilling confidence back into people.

"I'm sort of optimistic that the combination of the bailout program and other initiatives by the government—including an interest rate cut along with other capital and credit that's being extended to institutions—will show the world that the US government is behind freeing up liquidity and will do whatever it takes, and that other governments will follow.

"So then the question really becomes, when do things get back to normal and what is normal? My best guess is that it won't be until 2010 that credit starts getting extended, and then at conservative levels. It will be at least five years before there's aggressive lending again, but by the first or second quarter of 2010, we would expect to see lenders get back into lending money.

"It's not the bailout that will provide the liquidity. It will be the bailout combined with other government incentives and programs that will start to provide liquidity and consumer confidence. Even after that is put into place, you will still have a lot of institutions going out of business and a lot of assets being sold at discounts. In retrospect, you may be able to point to late 2008 or early 2009 and say that was the bottom, but there's still going to be a lot of bad news. It's similar to the last cycle, when you could point to 1989 or 1990 and say that was the bottom, but assets were still being sold at discounts through 1993.

"This is going to be a slow recovery; it won't be like flipping off a light switch. If you're a regional bank in the Midwest with a bunch of bad residential loans on your books, this bailout in and of itself isn't going to save your company. You won't be able to sell all of your assets to the government at a healthy price and start lending aggressively again. It's the nature of our economy that some companies are going to have to go out of business."