click for larger chart

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No, we are not profitable on the bailouts. TARP has $123B to go before breakeven, and the GSEs are $133B in the hole.

All told, the Taxpayers have a long way to go before we are breakeven. That’s before we count lost income from savings, bonds, etc., the increased costs of food stuff and energy due to inflation (the Fed’s has done this on purpose as part of their rescue plan), the higher fees the reduced competition of megabanks has created, and the future costs our Moral Hazard will have wrought in increased risks and disasters.

As the nearby charts show, we are far far from breakeven:

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Sources:
Behind Administration Spin: Bailout Still $123 Billion in the Red
Paul Kiel
ProPublica, March 17, 2011, 10:27 a.m
http://www.propublica.org/article/behind-administration-spin-bailout-still-123-billion-in-the-red

The State of the Bailout
http://projects.propublica.org/bailout/main/summary

Category: Bailouts, Really, really bad calls, Taxes and Policy

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

12 Responses to “TARP + GSE: $257 Billion in the Red”

  1. Francois says:

    Yet, the Amerikan Izvestia (that’d be the mainstream asshatery) keeps echoing the Administration’s canard that everything has been paid back.

    Is it that easy to be a well-paid pundit while being so slothful with facts and morally depraved with the truth?

    Must be nice if you don’t care about such quaint notions as self-respect and conscience.

  2. Nuggz says:

    The average American cannot balance a checkbook.

    People get the government they deserve.

  3. franklin411 says:

    Calling this “in the red” is utterly ludicrous.

    Let’s say someone has $1000 to invest. They purchase $1000 worth of stock. Then they sell some shares, generating $800.

    Now, is the investor in question “$200 in the red?”

    Of course not. That would be an idiotic overstatement designed to generate hype.

  4. dan10400 says:

    Can we add the foregone interest in my savings accounts to the costs please?

  5. AHodge says:

    Nice. the avalanche of BS out there makes me want ot heave
    the FF cash deficicit is only for starters of course and about 1/3 done
    but only if the nearly broke mortgae cand pool insurers cand come up with a further 100 bio or so
    or FF could stick a lot more to the banks, the ones that are all momentarily off f TARP and certified healthy

  6. Unsympathetic says:

    Barry,

    In this link, Stockman describes the entire motivation for TARP. http://mises.org/daily/5113/

    Why, exactly, should taxpayers not be compensated (bailout + return) for our bailout money? Why shouldn’t we demand the returns from being 20:1 levered on that $250B?

    Oh, that’s right: Those banks just have to pay bankers their insane bonuses. After all, they’re not teachers, so their contracts must be kept.

  7. And this doesn’t even reveal that so far as the GSE’s are concerned, the “repayment” they are making is through infusions the Treasury makes to the GSE. In other words, the GSE’s owe the Treasury money, but they haven’t any, so they ask for more from the Treasury, which they then use to show that their loans to the Treasury are being repaid, in the meantime, increasing the amount of total subsidies by the taxpayer to the GSE’s.

    And nothing of this accounts for the mechanism through which just regular TARP funds have been returned–by the Fed lending at zero interest rates to banks so that they work the carry trade to fill gaping holes on their balance sheets.

    The financial crisis, which is really just a visible manifestation of much larger socio-economic and demographic trends, has a long way yet to run.

  8. wunsacon says:

    Homes are still 20-50% above where they would’ve been without the USG gifting money to failed capitalists. Every would-be homebuyer can count as a cost of these interventions the extra hundreds of thousands of dollars they’ll spend.

  9. louis says:

    Until they pick up the soilders they left behind on the battlefield, etc.

  10. b_thunder says:

    And appropriately today the Fed allowed banks to raise dividends. We’re officially enterign the next “black swan” phase.

    Recall summer of 2007 – bear, lehman, and the rest were in a race who repurchases more of their own stock. Tens of billions of dollars were spent on buybacks. 16 months later most of them did not exist.

    Today, they are officially TBTF, and they’re distributing cash to shareholders because they know damn well that in 6-12 months there may not be any cash to distribute. However, they don’t have to worry about this because they’d get bailed out either way. So, rather than giving themselves small dividend/bonus and then require only a small bailout, they’re giving themselves a big bonus/dividend, and then will demand a giant bailout.

  11. gordo365 says:

    How about a transaction tax on all wall street and banking activity. Use proceeds to fill hole that was dug to save the system. Then keep it in place for a couple years beyond that and distribute proceeds evenly across all American tax payers for their trouble. Like oil payments to Alaskans.

    Shift the pain back to those who caused the trouble! Wall street made this mess. Now, in response, we are cutting fee lunches for poor kids. Unbelievable.

  12. [...] unemployment still easily over 20%. The TARP and Government Sponsored Enterprise bailout are still $257 billion in the red. 97% of new housing loans are backed by the US [...]