Banks set to hand out 1/2 of taxpayer supplied bailout money to shareholders as "dividends"

Anyone who opposes this simply hasn't studied enough economics (plus they're stupid).

:sarcasm:

:sarcasm:

I think that's going to be a running DU joke from now on.

It deserves to be a running DU joke!

And apparently so is stupidity. :)

A few years ago State Farm Insurance sent us a surprise dividend...


a check for 98 CENTS :rofl:

but I am

"...voluntary program"

Wait...your bank will FAIL unless I give it some emergency money, and then you would NEVER receive another dividend payment, but you just HAVE to have this particular dividend payment RIGHT NOW.



Man, that is hard to wrap my brain around...

:rofl:

i can't think of a better reason.

Assuming the numbers are right, 50% over 3 years means 16% in the first year. 16% of $163 billion is about $26 billion.

The problem with this is that the feds themselves took preferred stock, which means they get preference in dividends as well as in liquidation, and the feds are earning something like 5% on their preferred stock in the first year, rising to 9% in the coming years.

5% of $163 billion is ~$8 billion. That's how much they pay the government in dividends, by my back of the envelope calculations -- a little under 1/3 going right back to the U.S. Treasury. That's profit to the federal government. I have no problem with that.

That leaves ~$18 billion ($26 - $8) to other stockholders. Again, other preferred stockholders will have a preference over common stock. I don't know the capital structure of the banks in question, but it seems to me that much of that $18 billion in dividends would be dividends to other preferred stockholders, which payments would have to be made in order to avoid a default, which could trigger bankruptcy.

That's what the bailout was supposed to do -- avoid defaults and bankruptcy.

Hopefully, come January 22nd, the new treasury secretary will ensure that the banks will not be permitted to make dividend payments to common stockholders.

"Back of the envelope" calculations notwithstanding, if I hand you $5, and you hand me $1, I have not profited in any way--I am out $4! :hi:

In other words, giving back 5% does not erase the debit of the other 95% (much of which is being handed over to private investors as so-called "dividends".)

You hand me $5, and I give you a share of "preferred stock." The first year, I give you $1 in dividends. The next year I have to give you another $1. And the next year another $1. After that the rate doubles. I now have to give you $2 a year. The next year another $2, and the year after that another $2.

So all together I've given you $9 (1+1+1+2+2+2) on your $5 investment. But I still owe you $5, and you still have that share of preferred stock. Finally, I "redeem" (buy back) that share for its $5 face value.

Altogether you made $16 on your $5 investment.

That's basically the deal the feds got, although the rates are lower. If all goes well under Obama, the feds will get back everything they gave the banks plus dividends.

in other investments. :hi: Which is why no private investor will touch these so-called "investments".

There is no alchemy invented that can turn a government bailout into a market transaction.

But keep hiding behind your passive agressive "let's understand" schtick.

Here's one that is real, and based upon the actual numbers.

The US buys preferred stock from Bank of America for $25 billion.

The US gets a guaranteed 5% annual dividend for the first five years. That's $1.25 billion per year, due not this year, but next. The 5% dividend is analogous to interest the US might have gotten by putting the money in some other paper or investment. The 5% is for LOSS OF USE OF THE MONEY. It's hardly a profit.

BOA can buy back the preferred stock issued to the US, and will likely do so at some point, because in five years, the preferred dividend jumps from 5% per annum to 9% per annum. BOA will buy back such stock, because they cannot pay 9% dividend.

Your rationale is entirely faulty, and your example isn't remotely close to accurate. The US will likely get its money back in full, but it will be dollars that are inflated, and thereby somewhat diminished in value. The dividends paid to the US the first five years are essentially for loss of use of the funds. The US will get its money back, but as structured, the US will not make any money from this.

He's been wrong every step of the way.

Try to find something he's been right about the past two months.

He can't produce them.

All of which casts a slight doubt on his ability to prognosticate going forward.

:rofl:

I see your point, but it's an argument that folds over itself to support itself.

The problem here is that the payout of these dividends is anathema to the loosening of the credit which was supposed to be the ROOT problem being avoided by the bailout.

The real reason was NOT to avoid default and BKO. It was to provide the companies with sufficient liquidity to prevent them from having to tighten capital to maintain their internal liquidity. (Which, of course, for a financial institution would result in reduced cash flow and would eventually require tightening of capital anyway. Which if why i didn't support this plan, because it's too short term in its approach.)

And, the "other" preferred investors are entitled to a dividend why? You hold paper in a company that mismanged itself into a position where they had to take gov't money to maintain liquidity and capital positions and think you're still entitled to a dividend? That's not how investing works.

The clear and obvious issue with this payout is that it completely socializes the risk that the investors took. They invested with a company that had dividend pays and growth rates that looked attractive. That attractivenss was, in large measure, due to the management of the assets. That management of the assets was disasterously performed. So, the investors get all the benefit and assume no risk?

What financial or econ textbook would that be in? Don't spend too much time looking. You and i both know that it isn't in any book written by a sane author. Those investors deserve no dividend if the company is in such dire financial straits as to require public funds to survive.

The Professor

This action does not help the credit crunch, it makes it worse.

This is nothing short of a bank heist, pulled off by the same officers of the bank who ran the bank aground. The big stockholders make out like bandits under this, while consumers of the bank see their loan possibilities decrease, not increase.

This action does nothing for consumers, except those who hold stock that will pay dividends.

I agreed with the notion of the US buying preferred stock with a set dividend. I thought that was a smart way to increase bank capital, and thereby increase the potential loans of such banks by roughly ten fold. But that isn't happening. They're using money to buy other banks or pay dividends.

As soon as the election is over, I look for Obama and congress to start taking a hard look at what has been done, and this latest move is going to be attacked as unacceptable, as it should be. I hope the congress will shut off the funds until after Obama takes office. Once again, the Bush team cannot be trusted to be competent or honest.

Way too few strings attached to a short term fix that only addresses symptoms not causes.
The Professor

to take the money. Funny, the Europeans knew this was wrong and put
this in their bailouts proposals to purposely prevent this rape of the public's money.

The US? Socialize the profit but not the risk.

As the NY Times recently reported, it was both to free up lending (which hasn't happened yet) but also to prevent those banks that were "too big to fail" from failing.

While it might seem counter intuitive for a bank to pay dividends to the government right after they sell the preferred, that's just the way all loans and preferred sales are. In fact, if you've ever seen a loan or preferred stock agreement between a bank and a corporation, the corporation begins making interest payments immediately -- sometimes even at closing. In a traditional preferred stock deal, the dividends are payable at the first dividend payment date. It can be thought of as a cost of borrowing, which I'm all for because I want this to be costless or better profitable to the treasury.

Preferred stockholders are "entitled" to dividends because they are thought of in the financial sector as holding a hybrid between equity and debt. If they don't get the divided, then under most preferred stock arrangements, the issuer is in default. Most of the other debt agreements of the bank provide that if the borrower defaults on any agreement, it defaults under all debt agreements (that's called a "cross default"), and would trigger the collapse of the bank. To put it bluntly, if the preferreds don't get their dividends, then all other lenders and bondholders will immediately put the bank in default.

Remember, preferred is different from common stock, which the corporation may freely decline to pay dividends on without consequence (other than to the share price).

In general, your post seems not to recognize the difference between common and preferred. I certainly wouldn't argue that common deserves a dividend by your argument. But if you consider that Lehman collapsed because it defaulted on its preferred, then you will see that the market treats deferred more like debt that stock, and a default on preferred dividends is a catastrophic credit event.

Your posts seem to fail to recognize that the risk is still a risk. There is nothing you can teach me about the financial world. I've been a Board member of a bank (which is perfectly financially healthy, thank you) since 1986. I've got an advanced degree in economics and i've got more than 20 years of direct experience.

And that the "too big to fail" philosophy is one that must be taken on faith or refected. I reject it. You accept it as a tenet of faith. That's simply not scientific enough for me. And, The NY Times has Kristol on the op-ed page, so i would hardly think they are infallible. That name dropping fell on deaf ears. And, i simply disagree that the purpose of the bail-out was as diverse as you think. The fact is that the legislators thought they were preserving the overall economic condition, and had the vote been up or down to simply prevent the default of any particular bank, it would have lost 35 to 400! The macroeconomic motivation was by far the dominant reason for the support of this misguided effort.

Also, there is NOTHING(!) in the definition of preferred stock that suggests that the risk is zero. The hydridization of debt and equity does not obviate risk. The only difference is the order of dividend payout and, on liquidation, remuneration of investment. You are attempting to "circularize" your argument by hammering the "nuance" of preferred, when the nuance you suggest does not exist. The risk is still inherent in a preferred share and if a company is poorly financially managed, then the risk is assumed by the investor. The hybrid nature of the holding does NOT eliminate the risk when the company goes into financial distress. Continuing to tell others they don't understand, when in fact they do, and simply disagree, doesn't make your point any stronger. It just makes your message more annoying. Particularly in the case of someone with both training and experience in these matters.
The Professor

:loveya:

I guess we can put aside all questions of mind reading, such as what I do or don't accept as a tenet of faith. I have no idea whatsoever what you're talking about re: name dropping. Does that have to do with the Times? The Times reported that Treasury is trying to prevent big banks from failing. So is Gordon Brown. That's not name dropping; it's sourcing an assertion. Wtf does that have to do with Kristol?

But putting aside the crazier aspects of your post, the disagreement seems to come down to whether the banks that accepted the bailout funds should be allowed or required to default on their preferred stock by missing a preferred dividend. It has nothing to do with whether buyers of preferred thought they had zero risk. Of course they didn't. Neither did buyers of the banks bonds. Are you saying that because buyers of bank bonds knew there was some risk involved, the banks should be required to withhold interest payments on the bonds? Is that how a bailout works?

The only question is: what happens if the banks default on either their bond interest payments or their preferred dividends?

The answer: a catastrophic credit event. Cross defaults. The bank fails.

That's what happened to Lehman as a result of preferred default.

Either you want that to happen (by preventing payout to preferred) or you don't. That's really the only issue.

I assume that having handed over hundreds of billions in bailout money, the Treasury doesn't want to have the possibility of getting paid back evaporate into thin air by creating a catastrophic credit event by forcing the banks to default on the preferred.

Other than that, I can't for the life of me figure out what you're trying to argue about.

:shrug:

You are far less knowledgeable about these things than you believe yourself to be. This discussion has become tiresome and pointless.
The Professor

Yes or no:

"A default by a bank that is participating in the bail out on a preferred dividend would lead to cross defaults on other debt, the withdrawal of counterparties, and the likely collapse of the bank."

All other issues aside, that's the only question.

If you answer "yes," then I am puzzled why you would be surprised that the banks are paying dividends to preferred, why that is such a bad idea (assuming no payments to common) and why the Treasury should not allow dividends to preferred to happen.

I'm just trying to figure out where our differences are on this, because I usually find your posts to be knowledgeable. I don't question how knowledgeable you are (although I'm puzzled you question my knowledge without providing an actual argument about what I don't know).

Am I missing something?

:shrug:

On that one issue of course.

But, again, and no mind reading necessary, you are making the unfounded assumption that the failure of the bank will lead to economic catastrophe. Which means you bought the argument for the bailout.

Since i see ZERO evidence that the failure of any bank or any few major banks, would lead to financial collapse, (since there are thousands of healthy banks) then i don't accept that cross defaults would be the major issue you see.

Again, without mindreading, you are accepting on faith that the reasons for this bailout is because we "cannot" allow banks this big to fail. I think that's wrong.

But, you go ahead and stay with your unfounded beliefs. It doesn't harm me in any way.
The Professor

So yes, a preferred default is likely to cause a collapse of a bank. Thanks for acknowledging that. I think it's important for other DUers who are following this thread to know that, in order to put the news from the OP in perspective. Unlike you, most of them seem not to realize that preferred dividends have to be paid to prevent default, and that they represent a profit on the Treasury's investment in the risky banks.

Now we've narrowed the disagreement to "too big to fail."

I think both positions are legitimate -- that it may be false or true.

Some banks should fail.

On the other hand, I do think, based on knowledge (not faith), on historical examples (the role of bank runs in the Great Depression), what global political leaders and central banks are saying, and what I know about the markets from working in finance, that some banks are "too big to fail."

I don't know that the failure of several large commercial/investment bank conglomerations would lead to financial and economic catastrophe.

No one does.

But my estimate of the likelihood of a long severe depression, retirees losing their 401Ks and becoming impoverished, a collapse of the commercial paper market, the loss of money market accounts, massive unemployment, and other pretty nasty economic consequences is that it is quite likely if certain big failures occur. After all, it was the collapse of Lehman that many are blaming for the current credit freeze.

So that's really the decision faced by the Treasury and other central banks:

1. Do nothing and take the significant risk of something really, really bad happening;

2. Do something and reduce the risk of something really, really bad happening.

If that "something" (the bailout) stands to not only reduce the risk of something really, really bad happening, but could earn the Treasury billions of dollars, my preference is the "something."

It's not an article of faith; it's a cost benefit analysis based on what I (and the majority of financial commentators I respect, like Paul Krugman and Joe Stiglitz and whose opinions help shape mine) think are likely logical outcomes.

I suspect it will have the same result here.

I take comfort in the dissemination of accurate information especially on DU.

But I have no financial stake in any of this - any more than any other citizen who hopes not to see the next Great Depression.

If you have any of those, you have a stake in the bailout.

Are you saying you do not work in an industry affected by the stocks, bonds, and credit markets?

Now that's a sunk cost if I've ever seen one! :rofl:

All I'm saying is that I have no more direct interest than the average American.

I don't work in the financial industry and haven't for over a decade.

You falsely suggest that if the US gets paid dividends, all the other stockholders must get paid. The US has the primary position. It gets paid no matter what happens to the others.

As I pointed out earlier, the US gets a dividend of 5% per annum the first five years, and it gets that money no matter what happens with other shareholders. That 5% helps defray the costs of the US treasury to finance the funds used for the bailout. It is therefore not profit, but represents a return on the loss of use of the funds, much like interest, except the dividend is backed by ownership, not loan paper.

You are trying to sell something that isn't true. You are trying to sell the notion that the use of bailout funds to pay dividends is fine, because a small portion of those funds come back to the US in the form of the 5% dividends.

class. I'm saying two different things, which is obvious if you look at my post.

1. The US will get paid dividends on its preferred.

2. The banks have to pay dividends on preferred held by other stockholders, or else the bank would be in default, which would be a catastrophic credit event and lead to cross defaults.

This does not require nor imply that the preferred held by the US and others is the same class.

I find that unacceptable, and a misuse of the funds provided by the bailout.

You were lauding the bailout because it would supposedly ease the credit markets.

Will you admit that the payment of dividends reduces bank capital, and correspondingly reduces the potential loan funds available in the marketplace by a factor of approximately 1000 percent of the amounts paid in such dividends?

I've said repeatedly that dividends on common stock are not justified.

Payout of dividends on preferred, just like payout on interest on bonds, reduces working capital.

But not paying out dividends on preferred leads to the immediate collapse of the bank as ProfessorGAC has acknowledged.

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=389&topic_id=4335823&mesg_id=4336931

Is that what you're advocating?

But I don't consider that an appropriate use of bailout funds.

Any bank that cannot pay those preferred dividends without having bailout money to fund it SHOULD fail, and should be taken over by the feds. Just like we've always done.

I do not want to see banks saved from failure. They've earned the right to fail, and saving them from failure is stopping economic Darwinism from having its way in the corporate world.

If they had money to pay dividends, they wouldn't be in trouble.

What you're really saying is --you're opposed completely to the bailout. Fine, we can agree to disagree.

But I think it's a bit silly to say that the fact that the banks are paying dividends on preferred (or for that matter interest on bonds) is some kind of unexpected horror of the bailout.

What would be the point of bailing out any bank, ever, and then forcing it into bankruptcy by preventing a payout of dividends on preferred?

:shrug:

Just like anyone else?

"What would be the point of bailing out any bank, ever, and then forcing it into bankruptcy by preventing a payout of dividends on preferred?"

The point was (supposedly) to free up the allegedly frozen credit markets. Not to ensure that no investor ever lost money.

If common pays no dividends, the price of that common declines drastically. In the bailouts of AIG, Bear Stearns, etc., the common shareholders were wiped out. Those are the people we think of as the "investors" or owners.

The issuance of preferred and warrants, moreover, dilutes the holders of common and other preferred -- sort of like an instant "bailout tax" on the other shareholders.

But again, it comes down to whether you think some banks are "too big to fail". From what I know and have seen, I would say yes. You say no. Fine.

But as I wrote to PGAC, if it's possible to prevent a possible financial collapse while making money for the Treasury, I'd say go for it.

how can the shareholders expect dividends when the bank is bust? Aren't dividends a distribution of profits? It is my understanding of stocks that the shareholders "share" in the profits and "share" the losses. That is the gamble of buying stocks. If you take away the "gamble", then it is more like buying bonds? Just doesn't seem fair.

The dividends you are correctly referring to are dividends on common stock. Dividends in general are only paid on common stock out of profits. Each quarter, the corporation figures out what its profits are and "declares" a dividend based on the size of the profit.

Preferred stock, however, is different from common stock, and much of the argument in this subthread is based on the difference between common stock and preferred stock, and the question of what kind of dividends are going to be distributed.

Preferred stock are a separate class of stock that, when issued, include a promise to pay a certain dividend as a percentage of the face value of the stock every dividend date. Also, if the company goes bankrupt and its assets have to be distributed to the creditors (bondholders and bank lenders), and only then to stockholders what is left, the preferred stockholders get paid first before common stock holders; that's why they are called "preferred" -- they have a "preference" if the company is liquidated.

Because of the promise by the company to pay dividends on preferred stock, in finance preferred stock is treated like debt, not like stock. It's "dividend" is more like interest on a bond than a dividend on a share. In fact, the contractual terms on a preferred share are often almost identical to the contractual terms on a subordinated bond (like a junk bond). The main difference between junk bonds and a preferred stock is that preferred stock may have a representative on the board of directors like the common stock. Moreover, the main reason a company issues preferred stock rather than subordinated bonds or vice versa has mostly to do with tax issues.

For that reason, if a company fails to pay the dividend on preferred stock, the company is usually treated as though it missed a bond payment, not as though it simply decided not to declare a dividend on common stock.

If a company misses a dividend on preferred stock, it has broken a promise and is said to be "in default." Most of the bonds have terms that say if you default on any debt or on a dividend payment to preferred stock, you default on our debt (even if you have been paying our debt on time). That's called a "cross default." (Kind of like your credit card company A raising your rates because you were late on a payment to credit card company B.)

So, even if they are not profitable, companies have to make dividend payments on preferred stock. Lehman went bankrupt because they missed a dividend payment on preferred stock, and all the other creditors went scrambling and put them in bankruptcy.

Because the OP is about a group of banks, not one bank, we can't really tell how much of the proposed dividends are going to preferred stock. We know that about 1/3 of it is going to the preferred stock recently purchased by the federal government. Of the remaining 2/3, I can only estimate that given that they are not profitable, and knowing in general the vast amounts of preferred stock that investment banks issue, they are probably talking to some significant extent about dividends on preferred stock, not dividends out of profits on common stock. I certainly would not defend any payment of dividends to common stock, but I think the OP is misleading, at worst, but at best is certainly an incomplete picture because we know a big chunk of that money is going to preferred stock.

more efficiently than bureaucrats and cronies.

Who are you to decide which businesses should fail, and which should succeed?

I'm not. I'm hoping the bailout leads to heavily regulated mixed market socialism, in which capital is allocated only in part by markets, but also by politically determined social needs, and by rational industrial and financial policy.

But that's just me.

I just never bought into the whole free market fundamentalist thing you're now pushing.

rather than the monied gentry. :hi:

YOU are the one using the language of the free market to justify what amounts to welfare for investors.

"I'm hoping the bailout leads to heavily regulated mixed market socialism"

You are shameless. $700,000,000,000 of no strings attached taxpayer funds to the wealthiest Americans is not "socialism" by any standard, nor is it likely to lead to same (except inasmuch as it foments rebellion amongst those of us at the bottom of the heap.)

winners and losers in the finance system?

There IS precedence for this

The same was done, using the Depression model of winners and looses, by Norway not too long ago

The erosion of the capitalization inherent in dividend distribution exacerbates the very problem claimed ... and perpetuates the risk of failure for the sake of income that's currently taxed at historically low rates. I can't help but ascribe this kind of behavior to the federal tax policies that motivate 'owners' to force golden eggs out of the goose even though it'll kill the goose. When capital gain and dividend income is nearly tax-free and any sane person knows we can't tolerate such blood-letting for long, there's nothing to stop the opportunism.

The 'day-trader' market mentality of short-term income even if it destroys the underlying enterprise is a plague that's been coming on for 30 years. There's almost no connection whatsoever between 'investment' and any interest in improving the health of the underlying company. This has also been evident for over 20 years when it comes to executive compensation leading to 'scorched earth' management for the sake of performance bonuses. The myopic focus on short-term and quarterly horizons has effectively destroyed companies that have been around for fifty years and more. Instead of ensuring that the company will continue to provide employment and products for future generations, they're all candidates for "chop-shopping" ... sold for parts.

The people infesting the economy with such myopia are the death of it.

If they get away with this...

:nuke:

No you have not, free clue... the interbank lending rate has gone down from the high 5% points to the mid 2%... not as low as it needs to go... but it is DOING WHAT IT IS SUPPOSED TO DO

Free clue, further on... the FEDS are also buying commercial paper... care to tell me when was the last time they did this? Oh yes, the great depression

I am not too shocked to see some of this money used this way... and if the congress had balls they'd do something bout it... but the last time an early program was implemented the same happened... as in exactly the same threats and same things were done.

Care to tell me when that was? Hoover

Care to tell me why? Same systemic reasons

Oh and you may want to add Obama to the list of people you are calling out, which is AGAINST DU rules by the by. After all he kept telling you that this bailout was but the FIRST STEP

Here is even more of a free clue

We will see about 15 TRILLION (low ball) spent before all is said and done...

I am sure you knew that.

So yes, 90 B is a lot of money, not happy with it, but it is chump change with what will be spent when all is said and done.

oh wait.....

No loans available to small business? Just empower the SBA or SBIC's to give additional types of loans. Generate employment at the SBA, as well.
No loans available to homeowners? Setup a Federal Home Loan Bank. More employment. Clear, easy loans.

No damn bailouts.

Let the asshole banks who won't make loans, or didn't have the capital because they squandered it on high salaries, bonuses, and other scams, FAIL!! Like the good capitalist society we are.

As soon as the government went into the business of making loans, I guarantee you that appropriate mergers would have taken place in the banking world to compete.

We had the economic stimulus that went straight to the oil companies and now this. It's amazing what we've allowed "them" to get away with.

Jay

Wonder how the VOTE YES folks feel about it now.

Cuz that would be socialist and that wouldn't be good!

:sarcasm:

This was not the represented use of the money. It rewards shareholders. It does not help the credit markets. It does not make available more funds for lending. It does not grow the economy. What it does is give mass sums of money to those who own the stock, including many top officers of such banks.

It might be time to appoint a special prosecutor to investigate Paulson's activities.

This is an outrageous misuse of the money in the bailout.

And don't expect anything sane from the bailout proponents here. Among them, they don't know enough economics to split their breakfast check at Denny's. Your average cabbie knows as much as those guys.

that particular phrase has fallen out of favor with the monied classes, however.

for the past eight years, BushCo has been history's greatest criminal consiracy, taking hundreds of billions of dollars from taxpayers and "redistributing" it to themselves and their cohorts in crime . . . this lastest "bailout" is, in reality, one last great theft of public funds while these criminals still have access to the U.S. Treasury . . .

somewhere down the line, these guys should be made to pay for their grand larceny -- and pay dearly . . . I doubt it will ever happen, but it should . . .

Treasury forced the top eight banks to join the program, whether they wanted to, or needed to, or not. Some of them didn't want the money. If the banks are going to attract private capital (and they do need it), the terms must not be too onerous. As it is, the banks are not able to increase dividends.

But at the same time, the bailout must be crafted such that it is not "too onerous" on banks, who may therefore chose not to participate (presumably choosing insolvency and ruin rather than to limit so-called "dividends" to their private shareholders...)

Weren't these the same instutions that were threatened with imminent collapse if the bailout wasn't rushed through? And yet, these several weeks later, these self-same institutions can afford to be picky about the conditions attached to this "desperately needed" infusion of cash?

This is completely illogical. :hi:

bought off

Washington Mutual. no longer here

So yes, some banks failed and I actually expect more to fail

While others were fairly healthy. But this was forced on all of them........seriously. They didn't want us to know which ones were in trouble so there wouldn't be a run on the bank. So they all had to take the money. If the banks stopped giving dividends, they would never be able to raise capital, and we would be stuck funding them forever.

Tell me why we gave them this money again?

... the bank would try to have you prosecuted for fraud.

This is a fraud upon the USA. They represented the funds were needed for one purpose, and having gotten the money, are using it for another purpose.

This is self dealing. These officers all hold massive amounts of stock, and paying dividends transfer wealth from the US treasury to their pockets. This should be treated as a crime.

:grr:

I got into an argument w/my brother about this bailout - he listens to CNBC constantly & considers himself a financial expert. And I had to hear all the typical things that proponents say: "you don't understand..."; that due to complex economic factors, the world will end w/o a bailout; that it had to be done right now; & a speech about the glories of the free market. Oh, well, at least I can enjoy emailing him these articles!

When is my dividend check coming?

If you look upthread, I calculated that about 1/3 of those dividends go right back to the Treasury.

how could anyone think it would be different.

amazing.

If all goes according to plan, the new government on Jan 21 won't be willing to give permission.

"If all goes according to plan, the new government on Jan 21 won't be willing to give permission."