>i find your train of through comic and confusing.
The article is reasonably old - but is very good:
http://www.econbrowser.com/archives/2008/10/balance_sheet_o.html
While the Fed could directly buy assets to prevent deflation (a type of debt monetisation) - you will find that Bernanke has found a much clever scheme - targeted a the central problems of the banking system.
BNB will not pay back loans with it's current balance sheet. BNB will payback loans with it's future balance sheet. To understand what this could look like - you need to first understand the macro economic environment.
BNB
babcock & brown limited
