Posted on 07/09/2009 8:31:33 AM PDT by BGHater
On Wednesday, the Treasury Department announced [1] that nine asset managers (see the list below) had been picked [2] to partner with the government to buy older, hard-to-value mortgage-backed securities. Up to $30 billion in taxpayer money will go toward the effort. The fund managers will raise up to $10 billion, which will be matched by up to $10 billion in TARP money, with $20 billion more available from the TARP as cheap financing to boost the size of the buys.
Originally conceived [3] as the whole purpose of the TARP, then a major portion ($100 billion) of the TARP, the purchase of troubled assets was presented yesterday by Treasury officials as a modest intervention [4]. Things aren’t at the crisis point they were last September, the Treasury said, and banks have been able to raise large amounts of private capital over the past couple of months. But the market for these troubled securities remains sluggish. So the Treasury is just trying to “jump-start” the market, a senior Treasury official told reporters on a conference call Wednesday, adding that the approximately $40 billion in purchasing power created through the program would have a “significant impact.” But the Treasury said it could ramp up the program if the economy deteriorates. The fund managers could start buying securities as soon as next month.
Because the Treasury has scaled back its estimate of how much in TARP money will be used for these toxic security purchases, we’re changing our accounting for how much of the $700 billion bailout remains [5]. With that adjustment ($100 billion down to $30 billion), about $209 billion of the TARP money remains uncommitted.
The fund managers:
Toxic Assets = US Congress
The Obama administration = Epic FAIL!
The Bush Administration gets credit for four of those months, as well as the creation of the program in the first place. Personally I’m glad Obama has hesitated to jump into this, since so many horrible ideas for it were thrown around.
On the other hand, he deserves the “Epic FAIL” for plenty of other reasons.
The list, ping
They don’t have $30 billion. We need a Constitutional Amendment to stop them from inventing money we don’t have. They are undermining our currency. Enough is enough.
Gov.is just moping up the mess they created along with the fed at taxpayer expense.These people should be in jail today.
I would have physically thrown Paulson out of office while firing him. That being said. Obama voted for and championed the bail out and TARP while in the Senate.
funny thing is is that they said 1 trillion 3 months ago and markets went screaming! what a joke. its like 1/25 of the origingal intent. banks arent going to unload anyhting than they would have to write this crap down instead of leaving it at 100 percent. what a joke!!!
Vernacular:
Toxic Assets = loans that shouldn’t have been made that will be paid by those already paying their loans back (like me)
Oh dear, how much have we spent now??? I’ve lost count...
We need an amendment to the U.S. Constitution to require a BALANCED BUDGET and we also need TERM LIMITS for Congress!
Something to see here: another public pooch screw
As bad as TARP was, if they had used the TARP money last year to buy the toxic assets, not only would the government have reaped a small profit since, as we can see, a lot of what was toxic last year has proven not to be quite as toxic as thought, but we would have a better economy now, and we wouldn’t have taken the TARP money and used it to buy car companies.
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