For quite some time, the Federal Reserve, through its TARP facility, has been offering special loans to business and financials looking for liquidity. This, however, has not done much in terms of loosening credit and encouraging consumers to spend. So the Fed has expanded the TARP program to include consumer loans.

That’s right.

Now TARP is offering special financing for those who want to purchases securities backed by consumer debt:

* Credit cards
* Auto loans
* Student loans

The idea is that once things loosen up on that end, consumers will be able to borrow more money, and then they’ll be able to spend more money thanks to that debt.

Is it just me, or did all this focus on getting consumers in debt get us here in the first place?