'Fast Money' Recap: A Bailout That Makes Sense

Wall Street struggled Tuesday to continue a record two-day rally.

Despite moves by the Fed and Treasury Secretary Henry Paulson to ease the credit markets, the results were mixed. The Dow Jones Industrial Average closed up 36.47 points, or 0.4%, to 8479.86 and the S&P 500 was up 5.6 points, or 0.7%, to 857.41. The Nasdaq fell 7.29 points, or 0.5%, to 1464.73.

Unlike previous bailout plans in the financial industry, Dylan Ratigan said on the "Fast Money" show on Tuesday that the new plans actually look as if they may have an impact. He pointed out that Fannie Mae's 30-year mortgage bond rate dipped today on the news.

Other members of the trading panel also found the plans encouraging. Karen Finerman said she thought it was a good thing for the housing market to get lower rates. And Guy Adami said it would be encouraging if the dip in the 30-year fixed rate loans is sustainable.

Still, Finerman had her doubts, saying the scale of the relief effort --- $200 billion in consumer asset-backed securities --- was small in the context of the bigger picture.

Ratigan and others expressed fears that the pumping of so much money into the system could lead to inflation and the devaluation of the currency. Finerman, though, said, "We're not seeing inflation yet," and even if it does arrive, "it's the less of other evils."

The panel's discussion then shifted to whether the three-day rally could signal a time for trading opportunities. Adami thought so, noting the rise in ConocoPhillips(COP) as evidence that fundamentals are playing a bigger role in the market.