The way businesses smooth over the sine wave that is cash flow is by using credit. If credit were to have dried up, it'd be much harder for most businesses to buy inventory and make payroll.

And it's here that the so-called bailout bill wasn't a half bad idea. In theory, by buying up the underwater mortgage "paper" held by so many banks, the banks will get an infusion of cash and they can then make that money available in loans, so that, for example, your local supermarket can fill its shelves with food which you'll then buy over coming weeks.

The other element of the bill that may help was the increase in the FDIC guarantee from $100,000 per account to $250,000 per account. Now, while not many of us, personally, have $100,000 cash in our accounts, many businesses, especially small businesses, do.

That's not a lot of money for a company with 10 employees. And by insuring the larger amount, businesses and individuals will be less freaked out, they won't be as inclined to yank their cash out of banks, and the banks will once again have some money to loan out.

Of course, banks having money to loan doesn't explicitly mean that you're going to keep your job or that you're going to be able to afford your house or that your boss will be able to afford payroll this week. That's something none of us can predict, but we all stand a much better chance of it this week than we did last week, despite how the world markets might be reacting.

We might not be in as happy a world as one where there was a booming economy and where we can all collectively go back to watching the new season of Dexter, but the increased credit availability and better guarantees on deposits does provide some measure of hope.

Lessons from the past
Will it get worse? No one knows. Probably, at least, not right now. Probably not too much.

We've been down some bad economic roads before and we've learned some lessons. Japan had a similar economic hit in the early 1990s and instead of taking action, their government sort of let things run on their own. As a result, Japan's economy was hurting for almost a decade.

Back in the 1920s, Herbie Hoover really screwed up by leaving the economy to its own devices after the 1929 crash. FDR learned from Hoover's mistakes and concocted the New Deal. Since then, we've had any number of tipping points where elements of our economy mirrored the lead-up to the Great Depression, but the reason we've never really dropped into that level of pain is because we've learned a bit about what works and what doesn't.

In this case, love 'em or hate 'em, our congresscritters acted quickly. That was actually pretty important. I'll be honest with you: it bothers me greatly that this was another sky-is-falling-rush-to-vote situation, which cuts short reasoned analysis. It also bothers me that there are likely to be some jackasses out there making billions off the bailout when they should be locked up in jail. But once a President says the economy is failing, the longer you wait to give the impression things are turning around, the harder it is to turn things around.