Bail Out Concerns

A basic concept underpinning the current bail out proposals seems to be the government purchase of these distressed mortgage-related assets. This seems reasonable on the surface. My concern is how these distressed assets will be priced. In the case of Collateralized Debt Obligations (CDOs), I don't believe an accurate valuation is even possible right now. (IMHO) My recommendation would be to provide "rescue" funds to these banks based on an initial guestimate of value, and then do a future "true-up" of payments once the housing market stabilizes and a better valuation of these assets is possible. We simply should not (can not afford to) overpay these bankers for these assets. This is their mess.

UPDATE: Like most ideas, mine turns out not to be original: IMF Proposal