To direct the Securities and Exchange Commission to issue rules regarding short selling of securities, to establish a net worth certificate program in the Federal Deposit Insurance Corporation, increase the maximum amount of depository insurance, and for other purposes.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Bringing Accounting, Increased 
Liquidity, Oversight and Upholding Taxpayer Security Act of 2008'' or 
the ``No BAILOUTS Act of 2008''.

SEC. 2. FINDINGS.

    Congress finds that--
            (1) distinguished economists across the world have 
        concluded the Secretary of the Treasury Paulson's $700 billion 
        bailout will not resolve the liquidity concerns facing the 
        financial sector; and
            (2) there are simple regulatory fixes to resolve the 
        current financial industry liquidity concerns at little cost to 
        the taxpayer.

SEC. 3. S.E.C. REPORT ON APPLICATION OF ACCOUNTING RULES.

    The Securities and Exchange Commission shall report to Congress not 
later than 180 days after the date of enactment of this Act on the 
effect of the Commission's clarification on fair value accounting 
issued September 30, 2008.

SEC. 4. PROHIBITION ON NAKED SHORT SELLING.

    (a) Extension of Order.--Notwithstanding the effective date 
contained in the order of the Securities and Exchange Commission issued 
September 17, 2008 (Release no. 34-58572) and the limitations contained 
in section 12(k)(2)(B) and (C) of the Securities Exchange Act of 1934 
(15 U.S.C. 78l(k)(2)(B) and (C)), such order shall continue in effect 
until--
            (1) cancelled or withdrawn by the Commission; or
            (2) repealed by Act of Congress.
    (b) Permanent Rule.--Not later than 180 days after the date of 
enactment of this Act, the Securities and Exchange Commission shall, by 
rule, make permanent the requirements contained in the order described 
in subsection (a). Such rulemaking shall provide for the termination of 
such order upon the effective date of such permanent rule.

SEC. 5. REINSTATEMENT OF UPTICK RULE ON SHORT SALES OF SECURITIES.

    Not later than 90 days after the date of enactment of this Act, the 
Securities and Exchange Commission shall--
            (1) reinstate rule 10a-1 of the Commission's rules (17 CFR 
        240.10a-1);
            (2) rescind rule 201 of regulation SHO (17 CFR 242.201); 
        and
            (3) take such other actions as may be necessary to 
        reinstate the price test restrictions that applied to short 
        sales of securities prior to the Commission's action in the 
        proceeding entitled ``Regulation SHO and Rule 10a-1'', adopted 
        June 28, 2007 (Release No. 34-55970; File No. S7-21-06).

SEC. 6. NET WORTH CERTIFICATE PROGRAM.

    (a) Establishment; Purposes.--
            (1) Establishment.--As soon as possible after the date of 
        the enactment of this Act, the Board of Directors of the 
        Federal Deposit Insurance Corporation (hereafter in this 
        section referred to as the ``Corporation'') shall establish a 
        net worth certificate program under this section to provide 
        capital to insured depository institutions (as such term is 
        defined in section 3 of the Federal Deposit Insurance Act (12 
        U.S.C. 1813)) to assist such institutions to resolve solvency 
        problems.
            (2) Purposes.--The purposes of the net worth certificate 
        program established under this section shall be--
                    (A) to improve the capital position of troubled 
                insured depository institutions with real estate 
                holdings;
                    (B) to provide such insured depository institutions 
                the ability to sell and restructure assets; and
                    (C) to assist such institutions in their recovery 
                without use of taxpayer funds.
    (b) Principles.--The net worth program established under this 
section shall--
            (1) be based upon the Federal Savings and Loan Insurance 
        Corporation net worth program established under title II of the 
        Garn-St Germain Depository Institutions Act of 1982 (Public Law 
        97-320; 96 Stat. 1489);
            (2) be made available only for troubled financial 
        depository institutions that the Corporation determines could 
        be financially viable if provided solvency assistance under the 
        program;
            (3) provide for the Corporation to purchase capital in 
        troubled insured depository institutions in the form of 
        subordinated debentures or net worth certificates in such 
        institutions;
            (4) provide that insured depository institutions 
        participating in the program shall agree to such regulations 
        and terms of the program as the Corporation shall provide, 
        which shall include strict oversight and supervision, including 
        limitations on the compensation of senior executive officers of 
        such institutions and terms for removal of officers for poor 
        management;
            (5) provide that the Corporation shall fund net worth 
        certificates under the program by issuance of Corporation 
        senior notes and obligations to participating insured 
        depository institutions;
            (6) provide that the interest rate on net worth 
        certificates issued under the program and the senior notes and 
        obligations issued under the program by the Corporation shall 
        be identical;
            (7) not involve any subsidy, appropriation of funds, or 
        other cash outlay or use of taxpayer funds;
            (8) provide that asset sale transactions under the program 
        be held in the private market.
    (c) Regulations.--The Board of Directors of the Corporation shall 
prescribe any regulations necessary to carry out the net worth 
certificate program established under this section.

SEC. 7. INCREASE IN MAXIMUM AMOUNT OF DEPOSIT INSURANCE AND SHARE 
              INSURANCE.

    (a) Standard Maximum Deposit Insurance Amount Increased.--Section 
11(a) of the Federal Deposit Insurance Act (12 U.S.C. 1821(a)) is 
amended--
            (1) in subparagraph (E), by striking ``$100,000'' and all 
        that follows through the end of the subparagraph and inserting 
        ``$250,000.''; and
            (2) in subparagraph (F)(i)(I), by striking ``$100,000'' and 
        inserting ``$250,000''.
    (b) Standard Maximum Share Insurance Amount Increased.--Section 
207(k)(5) of the Federal Credit Union Act (12 U.S.C. 1787(k)(5)) is 
amended by striking ``$100,000'' and inserting ``$250,000''.

Summary: Bringing Accounting, Increased Liquidity, Oversight and Upholding Taxpayer Security Act of 2008 or the No BAILOUTS Act of 2008 - Directs the Securities and Exchange Commission (SEC) to report to Congress on the effect of its clarification on fair value accounting issued September 30, 2008. States that the order of the SEC issued September 17, 2008, continues in effect until: (1) canceled or withdrawn by the SEC. Or (2) repealed by an Act of Congress. Directs the SEC to: (1) reinstate rule 10a-1, (2) rescind rule 201 of regulation SHO. And (3) reinstate the price test restrictions that applied to short sales of securities before its action in the proceeding entitled Regulation SHO and Rule 10a-1, adopted June 28, 2007. Requires the Board of Directors of the Federal Deposit Insurance Corporation (FDIC) to establish a net worth certificate program to provide capital to assist insured depository institutions to resolve solvency problems. Amends the Federal Deposit Insurance Act and the Federal Credit Union Act to increase from $100,000 to $250,000 the standard maximum deposit and share insurance amount.