As Big Banks Repay Bailout Money, U.S. Sees a Profit

Source: NY Times

Nearly a year after the federal rescue of the nation’s biggest banks, taxpayers have begun seeing profits from the hundreds of billions of dollars in aid that many critics thought might never be seen again.

The profits, collected from eight of the biggest banks that have fully repaid their obligations to the government, come to about $4 billion, or the equivalent of about 15 percent annually, according to calculations compiled for The New York Times.

That does not include the roughly $35 million the government has earned from 14 smaller banks that have paid back their loans.

These early returns are by no means a full accounting of the huge financial rescue undertaken by the federal government last year to stabilize teetering banks and other companies.

The government still faces potentially huge long-term losses from its bailouts of the insurance giant American International Group, the mortgage finance companies Fannie Mae and Freddie Mac, and the automakers General Motors and Chrysler. The Treasury Department could also take a hit from its guarantees on billions of dollars of toxic mortgages.



Read more: http://www.nytimes.com/2009/08/31/business/economy/31taxpayer.html?_r=1&hp

Call me when they start loaning again at rates that arent usurious.

Not like them Traitorish Bushies/Cheney dudes.

I do agree that something had to be done or we would be back on the barter system, but it is not yet clear if the right things were done.

There are methods that could stabilize system after a complete global collapse, it is true that instead of tax payer money being wiped out by deficits, people with lots of money would have their assets removed.

Collapse or not to collapse is more about who takes the loss then how the system operates. Money was created from nothing, it was then skimmed to be given to a few sectors. When that money evaporates there are two methods, take it from pension funds, wages and taxation, or take it from where it went in the first place.

:shrug:

Stopping the collapse stops the loss mostly at the top end not the bottom.

Someone was talking about this on C-span this weekend . . .

they gave us shares - preferred shares, supposedly worth .67 cents on the dollar --

but actually worth much less?

Didn't hear all of it -- maybe we'll catch a repeat?

the question was never if there would be some that repayed at a profit.
the question was always how many losses and how severe those losses.

the losses will show up last. you really can't judge much from the early paydowns from the banks that didn't really need the money in the first place.

So now people are complaining that it isn't a 100% loss.

My goodness, take some good news and just appreciate it for a change.

They won't use it to pay back the money they borrowed in order to give the money. They'll find some pet project to spend it on.

Until and unless the Fed is audited, there is no way to know what our losses are. TALF, PPIP, TIP, etc. happened. We are still backstopping the financial sector to the tune of 23T. The loans mentioned in the piece will be renewed, not paid down because the big banks are still technically insolvent. Of course many of the smaller ones were quick to get out from under TARP. It was killing their credibility with clients and they found new ways to borrow from the government with less oversight.

So far only a small amount has been paid back, with an annual return of 15%. We can't know what the losses will be until we get years down the road and find out what financial institutions simply do not ever pay us back.

Are they paying back the low interest loans from WE THE PEOPLE with money from 0% Federal Reserve loans backed by WE THE PEOPLE?

“The taxpayers want their money back and they want the government out of our banking system,” Representative Jeb Hensarling, a Texas Republican and a member of the Congressional Oversight Panel examining the relief program, said in an interview.


What 'Jeb' means is that 'Hey thanks for all the bailout money, but don't think you are going to put any restrictions on executive pay, or create any sort of laws or oversight over how the free markets (banks) operate.

The article is pure bullshit. It cherry picked a few banks that are *beginning* to pay back the government. The citizens will never again see the money we gave to Fannie, Freddie or AIG.

A Texas Republican named 'Jeb'. What are the odds of that?