The Greater Abomination: Washington’s Lies About TARP’s “Success” Are Worse Than The Original Bailouts, Part I

Here's the non-esoteric, non-intellectual version of Stockman's insightful article:  the Fed allowed banks to repay their bailout loans by printing up trillions of dollars and giving it to the banks free of charge and risk-free.

Call it Redneck Economics 101, but that's the gist of our banking system.

http://davidstockmanscontracorner.com/the-greater-abomination-washingtons-lies-about-tarps-success-are-worse-than-the-original-bailouts-part-i/

Timothy Geithner Peppered TARP Inspector General Barofsky With F-Bombs: Book

http://www.huffingtonpost.com/2012/07/19/timothy-geithner-neil-barofsky-tarp_n_1686047.html?utm_hp_ref=business

Banks are using government loans to repay TARP

Peter is paying Paul.  And Joe Taxpayer ends up paying for all of it.


http://www.washingtonpost.com/blogs/ezra-klein/post/the-government-has-recouped-tarp-money-by-accepting-other-government-funds/2012/03/09/gIQAHgdT1R_blog.html

Head of TARP bailout resigns

Another government official resigns.

http://finance.yahoo.com/news/Summary-Box-Head-of-TARP-apf-3734109150.html?x=0

Jim Sinclair on bank bailouts and bonuses

Jim Sinclair’s Commentary

Who paid the bonuses for Wall Street and how it worked:

1. FASB capitulates and allows holders of OTC derivatives to value them at whatever they wish.
2. International investment firms begin strong mark up policies towards their crap inventory.
3. Profits from the mark up of crap OTC derivatives by the international investment firms is recognized as trading income.
4. Tarp money comes into the firms and goes out as bonuses to the management, trading department and general employees at obscene levels.
5. Stock and bond issues are made to pay back tarp funds.
6. Therefore the money bonuses out by the international investment firms were TARP funds, not real earnings, but false FASB permitted mark up paper earnings through the trading department and declared as trading income.
7. The TARP money was paid back through the issue of stocks and bonds to the public, therefore the public paid the TARP back, not the financial institutions.
8. The obscene level of bonuses is because this game of convert false paper profit into cash into the bank account of the banksters and their merry crew is now game over. It was the last dip at the well of public funds laundered via TARP of the caved in FASB.
9. In the final analysis the public paid those obscene bonuses that were in truth, unearned.

Wall Street bonuses

Apparently Wall Street believes there is no moral hazard in paying out $100 billion bonuses--even as they struggle to remain solvent.

http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article6991008.ece

This should raise the ire of taxpayers and customers of Citigroup:

Citi, the last of the big banks to pay back the cash it received from the US government’s Troubled Asset Relief Program, is expected to clock up losses of about $8.5 billion.

Yet it is expected to pay out about $5 billion in bonuses to its investment bankers. It is expected to reveal it has paid its staff more than $30 billion in salaries, benefits and bonuses.

Meanwhile, much of America is either unemployed, underemployed, or barely hanging on to their jobs.

Rogue's Gallery

The photo op outside the White House of big bank CEO's who have received TARP funds looked eerily like a lineup of criminals--only in $3,000 suits.