Bank Bailout Earned 8.2% Profit

[babylonsister]

http://politicalwire.com/archives/2010/10/20/bank_bailout_earned_82_profit.html

Bank Bailout Earned 8.2% Profit


The federal government's bailout of financial firms "provided taxpayers with higher returns than they could have made buying 30-year Treasury bonds -- enough money to fund the Securities and Exchange Commission for the next two decades," Bloomberg reports.

"The government has earned $25.2 billion on its investment of $309 billion in banks and insurance companies, an 8.2 percent return over two years, according to data compiled by Bloomberg. That beat U.S. Treasuries, high-yield savings accounts, money-market funds and certificates of deposit. Investing in the stock market or gold would have paid off better."

[cbdo2007]

1. That still doesn't make it right.

[babylonsister]

2. What should have been done? nt

[no limit]

4. Many more strings attached to the bailout. 8% return is tiny compared to what we could have gotten

Although this is certainly better news than losing money.

[cbdo2007]

5. They should have let more of the large banks fail rather than just throwing money at them.

Also more rules and stipulations for the banks that did get the TARP funds.

[FBaggins]

3. Should we be surprised?

I'm sure that any investor would love to take ownership interest in a business and also have the power to make the business profitable virtually by fiat.

If you can't turn a profit in that scenario, when can you?

Imagine a steel mill that's about to go out of business. The government could take over the failing mill, restructure any contracts that it didn't like... then mandate that the cost of steel fall to essentially zero for that mill while inserting trade barriers to steel from foreign mills.

Sure... that "investment" is going to pay off. But was it the right thing to do?

[janewin]

6. 8% in 2yrs in nothing

I paid 13% on my credit card per month to some of those institutions that took bailout money. If you believe this BS then better be prepared to support trickle down economics next time a republican proposes it. I wonder if they put into the calc the trillion of dollars infused by the FED reserve.

This was Bush's doing and not Obama