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But the once-unthinkable possibility that the $700 billion Troubled Asset Relief Program could end up costing far less, or even nothing, became more likely on Thursday with the news that the government had negotiated a plan with the American International Group to begin repaying taxpayers.
The Congressional Budget Office, which had a slightly higher loss estimate initially, in August reduced that to $66 billion.
Now Treasury reckons that taxpayers will lose less than $50 billion at worst, but at best could break even or even make money. Its best-case assumptions, however, assume that A.I.G. and the auto companies will remain profitable and that Treasury will get a good price as it sells its corporate shares in coming years.
Whatever the final losses from housing, auto companies, A.I.G. or smaller banks, those will be offset by taxpayers profits from the big banks that have been the focus of their ire since 2008.
http://www.nytimes.com/2010/10/01/business/01tarp.html?_r=2&hp
But the once-unthinkable possibility that the $700 billion Troubled Asset Relief Program could end up costing far less, or even nothing, became more likely on Thursday with the news that the government had negotiated a plan with the American International Group to begin repaying taxpayers.The Congressional Budget Office, which had a slightly higher loss estimate initially, in August reduced that to $66 billion.
Now Treasury reckons that taxpayers will lose less than $50 billion at worst, but at best could break even or even make money. Its best-case assumptions, however, assume that A.I.G. and the auto companies will remain profitable and that Treasury will get a good price as it sells its corporate shares in coming years.Whatever the final losses from housing, auto companies, A.I.G. or smaller banks, those will be offset by taxpayers profits from the big banks that have been the focus of their ire since 2008.
Good news. But if TARP proves to be a moneymaker for the government, it could lessen the distinctive to bailout large corporations in the future.
Or it could only encourage the little bastards to continue their idiotic social engineering in the marketplace, under the pretext that they can fix everything at will, by printing up a few barge loads of money.Good news. But if TARP proves to be a moneymaker for the government, it could lessen the distinctive to bailout large corporations in the future.
Good news. But if TARP proves to be a moneymaker for the government, it could lessen the distinctive to bailout large corporations in the future.
Or it could only encourage the little bastards to continue their idiotic social engineering in the marketplace, under the pretext that they can fix everything at will, by printing up a few barge loads of money.Good news. But if TARP proves to be a moneymaker for the government, it could lessen the distinctive to bailout large corporations in the future.
TARP was an essentially bipartisan piece of legislation, in that it was crafted by the Bush administration, supported by both Democrats and many Republicans, then taken over by the Obama administration.
The anger against it, paradoxically, takes no heed of the fact that TARP, along with the broader government rescue efforts, has been arguably a success. It will ultimately cost far less than the initial $700 billion price tag that stunned a nation. Major banks are profitable and can raise capital. Credit spreads—a key measurement of risk—are down to pre-crisis levels.
The White House now projects TARP will lose at most $50 billion, down from $105 billion projected earlier this year. Privately, Treasury Department officials say the U.S. may not lose a dime, and could ultimately make money depending on how some investments fare, in particular American International Group Inc. and General Motors Corp. In a $14 trillion economy, $50 billion is less than 1% of economic output.
"The incredible irony here is that TARP probably succeeded wildly beyond anybody's imagination," said Alan Blinder, a Princeton University economist who co-authored a paper crediting the administration's economic policies with preventing a second Great Depression. "Suppose the original TARP bill had been to spend $50 billion to avert a catastrophe. Would anyone have blinked?"
disincentive?
I think you can thank Team Obama for this result.
disincentive?
I think you can thank Team Obama for this result.
Without going and looking it up, I thought Tarp and the Stimulus were the last things Bush did as President. The ONLY two things he did that worked.
8 years of failure and the only two things he did that worked are hated by his base.
Without going and looking it up, I thought Tarp and the Stimulus were the last things Bush did as President. The ONLY two things he did that worked.
Without going and looking it up, I thought Tarp and the Stimulus were the last things Bush did as President. The ONLY two things he did that worked.
The stimulus was the new Dem Majority's first move upon taking the WH. It was a pork bonanza masquerading as a recovery initiative.
that is a different stimulus than The American Recovery and Reinvestment Act of 2009 — President Obama's $787 billion stimulus
Recovery Act: How Obama's Stimulus Is Changing America - TIME
altho it was a stimulus and he did sign it 6 months before the election. It was only $168 billion.
TARP was an essentially bipartisan piece of legislation, in that it was crafted by the Bush administration, supported by both Democrats and many Republicans, then taken over by the Obama administration.
The anger against it, paradoxically, takes no heed of the fact that TARP, along with the broader government rescue efforts, has been arguably a success. It will ultimately cost far less than the initial $700 billion price tag that stunned a nation. Major banks are profitable and can raise capital. Credit spreadsa key measurement of riskare down to pre-crisis levels.
The White House now projects TARP will lose at most $50 billion, down from $105 billion projected earlier this year. Privately, Treasury Department officials say the U.S. may not lose a dime, and could ultimately make money depending on how some investments fare, in particular American International Group Inc. and General Motors Corp. In a $14 trillion economy, $50 billion is less than 1% of economic output.
"The incredible irony here is that TARP probably succeeded wildly beyond anybody's imagination," said Alan Blinder, a Princeton University economist who co-authored a paper crediting the administration's economic policies with preventing a second Great Depression. "Suppose the original TARP bill had been to spend $50 billion to avert a catastrophe. Would anyone have blinked?"
Bailout Ends, Not Anger - WSJ.com
Obama was pretty smart to light a fire under the feet of those TARP recipients. It's amazing how fast they want to pay the taxpayer back since Obama converted non-voting preferred shares to voting stock. Yet, it had the right wings' panties in a collective wad, with shouts of Obama's secret socialist plan to take over industry.
Obama was pretty smart to light a fire under the feet of those TARP recipients. It's amazing how fast they want to pay the taxpayer back since Obama converted non-voting preferred shares to voting stock. Yet, it had the right wings' panties in a collective wad, with shouts of Obama's secret socialist plan to take over industry.
What Obama did was legally wrong, and amounted to breach of contract. It reinforced an idea central to the US globally. It said to the world that America's word is not bound by law and is only as good as it's current leadership.
BUT it actually did force TARP to be wound down quickly with few losses YET to the taxpayer.
But we still don't know when AIG is gonna be solvent or how many more bailouts they may need.
Some firms ended up subsidizing the loses of others.
And as soon as team Obama took the WH they changed the rules of the game pissing off the banks who felt like they had been sucker punched. They proceeded to repay tarp loans as fast as possible to eliminate the authority that being on the hook for those loans gave team Obama over their salaries and business practices.
Ask any banker; under Bush TARP was a bailout, under Obama it became a Trojan Horse.
Obama was pretty smart to light a fire under the feet of those TARP recipients. It's amazing how fast they want to pay the taxpayer back since Obama converted non-voting preferred shares to voting stock. Yet, it had the right wings' panties in a collective wad, with shouts of Obama's secret socialist plan to take over industry.
I also think there was enough "moral hazard" fear in the bailout, between Bear Sterns failing, and Lehman Brothers being gobbled up for chump change.
that is a different stimulus than The American Recovery and Reinvestment Act of 2009 President Obama's $787 billion stimulus
Recovery Act: How Obama's Stimulus Is Changing America - TIME
altho it was a stimulus and he did sign it 6 months before the election. It was only $168 billion.
