Posted on 10/02/2010 1:17:48 AM PDT by Libloather
$700B TARP bailout ends Sunday, will wind up costing $100B or less
The Troubled Assets Relief Fund (TARP), an unpopular government rescue program credited by economists with preventing another Great Depression, will go out of business Sunday.
By Kevin G. Hall and David Lightman
Originally published Friday, October 1, 2010 at 9:18 PM
WASHINGTON — An unpopular government-rescue program credited by economists with preventing another Great Depression will go out of business Sunday, two years to the day it was created.
On Oct. 3, the Troubled Asset Relief Program (TARP), known as the bank-bailout bill, loses authorization to make new expenditures. From that point on, TARP will be in wind-down mode, although much of money lent out has been repaid and at a profit for taxpayers.
Originally envisioned as a blank check for the government to spend up to $700 billion to rescue the financial system, the cost to taxpayers is estimated now to be only one-seventh of that amount. The government has earned almost $13 billion in dividends from the bank stock it received in exchange for the taxpayers' investment, and it earned $8.2 billion more from the sale of preferred stock.
The Treasury Department estimates taxpayers are still on the hook for about $100 billion, a number expected to shrink with continued repayments and asset sales. The nonpartisan Congressional Budget Office (CBO) recently put the estimated total TARP cost at about $66 billion.
White House spokesman Robert Gibbs on Thursday said the latest internal estimates put the number at less than $50 billion.
Still, TARP became politically poisonous.
**SNIP**
"Objectively, TARP has been an economic success. Politically, it's been a miserable failure," said Darrell West, director of governance studies at the Brookings Institution in Washington, D.C., a center-left policy-research center.
(Excerpt) Read more at seattletimes.nwsource.com ...
Goes along with just about everything else.
Creative Finance at best
And how much of that is overvalued shares of GM?
Boy would people have to be gullible to believe this. This is Obama and the MSM trying to save the democratic party. That is what this is about.
People might want to stop and think if this is true then how come we are 5 trillion more in the hole 3 years later? And what about all the money the democrats are spending on all there other social bailouts? They only made it worse in the end. In fact the end result will most likely be the economic sinking of the USA.
I bite. We just spent $100 billion on c$$p we didn’t need. So how are we ahead?
A “government profit”?
Used to be we just called it “confiscation of private property.”
It's amazing what government wonks will consider to be profit now-a-days. We taxpayers still took it in the rear.
With success like this, who can possibly be upset about the state of the Union? What a bunch of doublespeaking evil snakes.
If the TARP only cost $100 billion, then what have they spend the rest of the $1.6 billion deficit on?
they switch from TARP providign the bailout to the FEderal Reserve. Didn’t the FEd buy up up to $1 trillion worth of junk mortgage securities?
All the execs at financial corporations should have lost 90% of their stock as a condition of aid. Now we should introduce a “We want our money back” tax on the profit of any bank bailed out.
Without the bailout their equity would be a big fat zero, so they *shouldn’t* complain much. It’s any more socialistic than bailing them out
Amazing how useless our press has become. At one time considered to be the guardian of freedom against government abuse, now they simply lie and rewrite history to fit their own political agenda.
PROPAGANDA
So the final cost of averting a possible global financial meltdown was only 100 billion? In comparison, Obama and the Dems spent 800 billion for nothing.
Sounds like GWB did the right thing...regardless of who didn’t like it.
After his tax cuts, the war in Iraq, the prescription drug plan, the Patriot Act, and the surge, I’m not surprised. All were the right things to do..not the popular ones.
I sure do miss that.
If Obamao says so it must be true. Right along with the big lie that the recession is over.
It’s Bush’s fault.
“they switch from TARP providign the bailout to the FEderal Reserve. Didn’t the FEd buy up up to $1 trillion worth of junk mortgage securities?”
Exactly, but it’s more like $6T. Its been a giant shell game with the Fed. Some day I’ll sort it all out, but what I think is going on is that the regulators are letting banks value mortgages at face value, something like this:
A loan for $600k for a house in CA now worth $300k, with an owner who stopped paying, is still valued at $600k on the books at the bank. The bank then uses that loan as collateral and borrows the full $600k from the Fed - and so the bank is ‘healthy’, and the Fed has worthless paper. The goal for the government is then to try to jack up housing values so that $300k grows as much as possible, but that cannot happen because income levels simply cannot support those insane prices - and also because there are about 10M more houses than required in this country.
I think that’s what’s going on. All the exposure is at the fed, and we’re supposed to think all is healthy again.
Yes, he did. According to the 6 month old articles below, President Bush’s TARP will break even or will result in a small profit of $9 to $29 BILLION.
No one cares about the facts. Far more lucrative for some to continue pillorying President Bush for averting a worldwide banking system collapse with a resultant worldwide depression. Much easier to install worldwide communism within that scenario.
Oh well...Bush sucks...Bush's fault...etc. etc. ad nauseum.
Bush’s $350 Billion TARP is About to Break Even by Gregory Hilton, MARCH 27, 2010
Was the Bush TARP Program a Mistake? by Gregory Hilton, MARCH 28, 2010
It was supposed to be tied to projects (that which didn't fall down the union slush-fund rabbit hole), and I suspect there's a paucity of good Project/Program Managers in the “Organized Community”.
The real measure should be how many of those projects proudly declaring they were paid for by TARP fund actually got done.
About 15% inefficiency sounds par for them.
Does that include the banks which were locked in a room with Secretary Paulson and forced to take the TARP money so the Treasury could disguise which banks really needed it and were a step away from bankruptcy? The government forced all the big banks to take it to prevent a run on the truly bad ones which would have been exposed if only a couple took the money.
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