Jump to content
House Price Crash Forum
Sign in to follow this  
MOP

U.s. Taxpayers Could Be On The Hook For $23.7 Trillion To Bail Out Financial Companies

Recommended Posts

U.S. Bailout Costs May Reach $23.7 Trillion, TARP Inspector Says

July 20 (Bloomberg) -- U.S. taxpayers may be on the hook for as much as $23.7 trillion to bail out financial companies, according to Neil Barofsky, special inspector general for the Treasury’s Troubled Asset Relief Program.

Barofsky made the estimate in testimony prepared for a congressional hearing tomorrow.

To contact the reporter on this story: Dawn Kopecki in Washington at dkopecki@bloomberg.net

Last Updated: July 20, 2009 12:14 EDT

http://www.bloomberg.com/apps/news?pid=206...id=aQEI97EY.fs0

Story just breaking so not much info yet. I hope this is some kind of bizzare typo? :unsure:

Share this post


Link to post
Share on other sites
Guest Daddy Bear
U.S. Bailout Costs May Reach $23.7 Trillion, TARP Inspector Says

:D

Share this post


Link to post
Share on other sites
PRINTY PRINTY!

Come on folks - there can't be any doubt at all now, surely to god?

I wouldnt normaly dare replying to one of your posts injin for fear of sliding quickly over my head but is this inflationary?. If it is, then i should dump my savings into assets before cash becomes worthless? Silver perhaps. Its ok you dont have to reply, ill pick it up as i go along.

Share this post


Link to post
Share on other sites

More meat on the bones:

U.S. Rescue May Reach $23.7 Trillion, Barofsky Says (Update2)

Share | Email | Print | A A A

By Dawn Kopecki and Catherine Dodge

July 20 (Bloomberg) -- U.S. taxpayers may be on the hook for as much as $23.7 trillion to bolster the economy and bail out financial companies, said Neil Barofsky, special inspector general for the Treasury’s Troubled Asset Relief Program.

The Treasury’s $700 billion bank-investment program represents a fraction of all federal support to resuscitate the U.S. financial system, including $6.8 trillion in aid offered by the Federal Reserve, Barofsky said in a report released today.

“TARP has evolved into a program of unprecedented scope, scale and complexity,†Barofsky said in testimony prepared for a hearing tomorrow before the House Committee on Oversight and Government Reform.

Costs include $2.3 trillion in programs offered by the Federal Deposit Insurance Corp., $7.4 trillion in TARP and other aid from the Treasury and $7.2 trillion in federal money for Fannie Mae, Freddie Mac, credit unions, Veterans Affairs and other federal programs, he said.

Barofsky offered criticism in a separate quarterly report of Treasury’s implementation of TARP, saying the department has “repeatedly failed to adopt recommendations†needed to provide transparency and fulfill the administration’s goal to implement TARP “with the highest degree of accountability.â€

As a result, taxpayers don’t know how TARP recipients are using the money or the value of the investments, he said in the report.

The Treasury has spent $441 billion of TARP funds so far and has allocated $202.1 billion more for other spending.

In the nine months since Congress authorized TARP, Treasury has created 12 programs involving funds that may reach almost $3 trillion, Barofsky said.

To contact the reporters on this story: Dawn Kopecki in Washington at dkopecki@bloomberg.net; Catherine Dodge in Washington at Cdodge1@bloomberg.net.

Last Updated: July 20, 2009 13:37 EDT

Not a typo after all.

F**k! :blink:

Share this post


Link to post
Share on other sites
Guest Daddy Bear
That's an awful lot of paper.

$24,000,000,000,000

That's got to be inflationary, surely?

No - don't be such a silly billy - how could this be inflationary...... it's got to be.....

.....HYPERINFLATIONARY

Share this post


Link to post
Share on other sites
Guest Daddy Bear
Dow still going up.

After all 24 trillion dollars is only double US GDP! Let those pesky grandkids sort the problem out!

I have said it before and I will say it again...

The DOW will be > 30,000 pts within 5 years

Share this post


Link to post
Share on other sites

Denninger going apeshit over this:

Monday, July 20. 2009

Posted by Karl Denninger in Politics at 13:46

TWENTY-FOUR TRILLION DOLLARS?!

Ex-freaking-scuse me?

Barofsky said that while the TARP program that Congress passed amounts to $700 billion, the total federal government support since 2007 for the economy and the financial sector could reach a far higher figure of $23.7 trillion. The government has committed significantly more money through a variety of other federal agencies and programs.

WHAT?!

$23.7 trillion dollars?

Where was the Congressional appropriation for that?

This is blatantly unconstitutional folks. We're talking about nearly double the nation's GDP in debt commitments and more than 33 times the amount authorized by Congress.

Oh, and it gets worse:

Meanwhile, Barofsky's office has opened 35 criminal and civil investigations into issues including suspected accounting fraud, securities fraud, insider trading, mortgage servicer misconduct, mortgage fraud, public corruption, false statements and taxes.

That's right, we have 35 criminal investigations connected to this nearly $24 trillion dollars of largesse too, and that's only what Mr. Barofsky knows about. Anyone care to gander about what's hidden from him? Oh wait - we got a problem there too:

"Treasury’s continued unwillingness to provide basic transparency despite the many recommendations of SIGTARP and Congress and the repeated demonstration that meaningful data from TARP recipients can be gathered and easily disseminated is unacceptable," said a memo prepared by Republicans on the oversight committee.

Hello Richard Nixon! Bailoutgate anyone? Obstruction?

Shall we continue?

This is outrageous and threatens the very stability of our nation. How anyone can believe our banking system or indeed our nation's Treasury can survive the exposure of $24 trillion dollars, twice our GDP, is beyond me.

We most certainly cannot, and when (not if) our creditors and lenders, including China and Japan, wise up to what's going on here the game will quite literally be over, perhaps as soon as "right now."

A couple of market technicians have noted certain "patterns" in the market that have potential downside targets of zero. That sort of thing normally results in a loud guffaw from me - even though I'm bearish I'm not that bearish - I couldn't imagine anything short of global thermonuclear war, ala "Joshua", that could lead to such an outcome.

Well I think I just found something purely economic that could lead to that outcome, and its right here.

Congress is all we have left - they need to take control of this problem right here and now, revoke the authorization for this ersatz spending commitment immediately, and appoint a whole passel of special prosecutors to start issuing indictments to everyone involved in this outrage.

We need cops and we need 'em right now before our creditors decide to cut off our credit card and destroy this nation's economy and government - a decision that they could make literally at any time.

http://market-ticker.org/archives/1240-TWE...LLARS!.html

Share this post


Link to post
Share on other sites

http://market-ticker.org/archives/1240-TWE...LLARS!.html

This is outrageous and threatens the very stability of our nation. How anyone can believe our banking system or indeed our nation's Treasury can survive the exposure of $24 trillion dollars, twice our GDP, is beyond me.

To try and be balance for a moment is really 2x GDP an issue, it's only like a 2x income mortgage.

Obviously GDP could contract increasing this multiply but is 2x GDP a big problem?

On my more cautious side I wouldn't ever want to deficits to be anything more than 1x GDP, but even that in the long term would be excessive.

Edited by interestrateripoff

Share this post


Link to post
Share on other sites
PRINTY PRINTY!

Come on folks - there can't be any doubt at all now, surely to god?

But printing money a la Zimbabwe simply leads to total economic collapse. History is clear.

So

WHY WOULD THEY DO IT?

Why not default all the bad debt instead? Goodbye AIG, yes it wipes out some of people's savings and yes the US government would not be able to borrow from abroad. But with 250 million people and a large, resource rich country they don't actually need to borrow to lead a normal life - only to lead a 2007 fantasy life.

Why would they go down the "Printy Printy" route, when it has been proven in the past not to work, and is not the only solution?

Share this post


Link to post
Share on other sites
But printing money a la Zimbabwe simply leads to total economic collapse. History is clear.

Even if the new economic paradigm of debt is wealth? Are you sure about this even when there is a very large blackhole sucking in everything before it?

Share this post


Link to post
Share on other sites
Even if the new economic paradigm of debt is wealth? Are you sure about this even when there is a very large blackhole sucking in everything before it?

I'm afraid the real paradigm is...

WEALTH IS DEBT.

Say it loud!

Share this post


Link to post
Share on other sites
Even if the new economic paradigm of debt is wealth? Are you sure about this even when there is a very large blackhole sucking in everything before it?

Maybe I have read too much Market Ticker, but I would amend your signature to "If DEBT is the problem DEFAULT AND/OR REPAYMENT is the solution"

Debt is money but it isn't wealth overall. If a bank creates a £100 loan it creates £100 of extra money, but the asset (equal to the interest you have to pay) that it creates is offset by the liability you have to pay it - the economy overall gains no wealth.

Equally if you print £100, it doesn't increase the overall wealth of the economy - it just makes every other £1 worth slightly less.

Wealth comes only from growing stuff, making things, doing work.

The problem isn't a black hole, it's more like Wily E Coyote running off the cliff - he looked down in 2007, and is currently falling, but he will hit the bottom eventually. When every last mortgage, bond and loan that can't be repaid has been identified and defaulted, the problem overall is solved.

Share this post


Link to post
Share on other sites
Before we all get too excited, the term "on the hook for" is not the same as "cost".

?

Share this post


Link to post
Share on other sites

http://www.sigtarp.gov/reports/congress/20...to_Congress.pdf

Page 137:

TARP IN CONTEXT: OTHER GOVERNMENT

PROGRAMS TO ASSIST THE FINANCIAL SECTOR

By itself, the Troubled Asset Relief Program (“TARPâ€) is a huge program at $700

billion. As discussed in SIGTARP’s April Quarterly Report, the total fi nancial

exposure of TARP and TARP-related programs may reach approximately $3 trillion.

Although large in its own right, TARP is only a part of the combined efforts of the

Federal Government to address the financial crisis. Approximately 50 initiatives

or programs have been created by various Federal agencies since 2007 to provide

potential support totaling more than $23.7 trillion.

The Federal Reserve has been one of the lead agencies responding to the financial

crisis — increasing its balance sheet to more than $2 trillion to implement a

wide range of programs designed to stimulate liquidity in fi nancial markets, as well

as several institution-specific interventions.321 The Federal Reserve’s $2 trillion balance

sheet (which grew from approximately $900 billion prior to the fi nancial crisis

to a peak of nearly $2.3 trillion in December 2008),322 however, does not reflect the

true potential amount of support the Federal Reserve has provided to those programs,

which is estimated to be at least $6.8 trillion. This is because many of the

programs involve guarantees that, although not listed on the balance sheet, expose

the Federal Reserve to signifi cant losses if the assets they are backing deteriorate in

value.

Other players in the Government’s efforts include the Federal Deposit

Insurance Corporation (“FDICâ€), which has contributed more than $2 trillion in

new gross potential support. The newly created Federal Housing Finance Agency

(“FHFAâ€) — under whose auspices fall the Government-Sponsored Enterprises

(“GSEsâ€) such as Fannie Mae, Freddie Mac, and Federal Home Loan Banks

(“FHLBsâ€) — has effectively provided more than $6 trillion in gross potential

support. Meanwhile, Treasury itself has programs outside of those authorized

under the Emergency Economic Stabilization Act (“EESAâ€), and has supplied

potential support beyond TARP of approximately $4.4 trillion. An overview of the

Government’s new potential support relating to the fi nancial crisis is listed by

Federal agency in Table 3.4.

Of this $23.7 trillion in assistance to financial institutions, participants in

non-TARP programs are not subject to TARP’s restrictions and conditions, such as

executive compensation, nor do they necessarily require specifi c Congressional approval.

Although SIGTARP’s oversight responsibility is for the operations of TARP

and directly related programs (such as TALF and the Public-Private Investment

Program (“PPIPâ€)), it is necessary to understand the larger context in which

TARP operates, the linkages between TARP and the trillions of dollars of other

Government initiatives. As noted earlier, SIGTARP has no authority over any of the

non-TARP activities of the agencies discussed below.

Messge to the US taxpayer if they don't like it:

akcs_www.jpg

post-16847-1248183336_thumb.jpg

Edited by MOP

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • The Prime Minister stated that there were three Brexit options available to the UK:   288 members have voted

    1. 1. Which of the Prime Minister's options would you choose?


      • Leave with the negotiated deal
      • Remain
      • Leave with no deal

    Please sign in or register to vote in this poll. View topic


×

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.