US may spend up to 2Trillion to bailout banks

moe: http://rawstory.com/news/afp/US_may_spend_up_to_two_trillion_dlr_01292009.html

The United States may spend up to two trillion dollars to bail out banks reeling from losses amid financial turmoil and a deepening recession, the Wall Street Journal reported Thursday.

The US Congress this month agreed to release the second half of a 700 billion dollar financial bailout fund, most of which have so far been used to shore up ailing banks, but the report said lawmakers might be asked to approve even more money for the purpose.

Government officials have discussed spending another one to two trillion dollars to help restore banks to health, the Journal said, quoting people familiar with the matter.

Some of the remaining 350 billion dollars from the Troubled Asset Relief Program (TARP) fund has already been earmarked for other efforts, including aid to auto makers and to homeowners facing foreclosure, the report said.

In the wake of all this bailing out, I don't recall ever reading or hearing a valid reason for doing so, other than to help the investor class. Have I missed something?

now for a period TBD

the Fed has already spent that money. They probably just want to be reimbursed. Bloomberg was unable to get info from the Fed under FOIA to explain how they had spent the $1.2T they already used for bank rescue. Bush's Justice Dept said the Fed didn't have to comply. Sorry I no longer have the link.

How could you be so cruel?

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If I could get paid one bonus such as these guys get every year, I could retire and not worry about money.

but I'd sure like to know how they calculate that?

I would also be much more comfortable with the government buying and then refinancing bad mortgages (like we thought wss suppoed to be part of TARP before they changed their minds and decided to just give the banks a blank check). At least there would then be some real assets tied to the funds and the government (taxpayers) would have some chance to recover it's investment.