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Negative $35 billion dollar loss to taxpayers so far

DSUrocks07 wrote:Negative $35 billion dollar loss to taxpayers so far

Yup - I've always said TARP was probably the best thing that was done in response to the economic crisis. The fact that we've already profited $35B on the program is fantastic. I'm still wary of where we'll end up with AIG, GM, and Chrysler, but there was always bound to be some duds in there. Overall, easily one of Bush's best decisions to avert an absolute disaster.

So where did all those troubled assets go?

kalm wrote:So where did all those troubled assets go?

That's the thing, those "troubled assets" were bad to the banks because they couldn't move them. They still had value that could only be realized if they were held for awhile. Just like all the homeowners whose property value dropped, their home still had value even though they were underwater in regards to their mortgage. if you were buying and selling homes for a living it sucked for you. But if you bought to own u were good.

kalm wrote:So where did all those troubled assets go?

The Fed bought them. The banks used the proceeds to buy equities. That's why the value of the stock market is inflated to historically high p/e ratios now.

CitadelGrad wrote:

kalm wrote:So where did all those troubled assets go?

The Fed bought them. The banks used the proceeds to buy equities. That's why the value of the stock market is inflated to historically high p/e ratios now.

So did the fed buy just the loans themselves, or did they biy some of the bets as well? And did the Fed get a good deal on the price?