Sooner5030
4/27/2012, 09:32 PM
Some good stuff in the executive summary quoted below. I can't believe the inspector general actually mentioned the moral hazard part....it's like his staff reads zerohedge and the market-ticker. Interesting part is that this is the first time I have heard about the FED reporting the different behaviors among banks that received TARP funds compared to those that did not.
And before the finance gurus come on here to remind us of the “ FINANCIAL COLLAPSE” boogie man and how we'd all be waiting in the soup line if it wasn't for TARP let me remind you that you are wasting your time convincing me of anything. No one truly knows what would've happened.......and if .gov and/or financial industry was so good at predicting outcomes the “collapse” would not have happened in the first place. So suck it!
http://www.sigtarp.gov/reports/congress/2012/April_25_2012_Report_to_Congress.pdf
After 31⁄2 years, the Troubled Asset Relief Program (“TARP”) continues to be an
active and significant part of the Government’s response to the financial crisis. It
is a widely held misconception that TARP will make a profit. The most recent cost
estimate for TARP is a loss of $60 billion. Taxpayers are still owed $118.5 billion
(including $14 billion written off or otherwise lost). But the analysis should not
be focused alone on money in and money out
..........
...
…
…
…
While TARP and other Government responses to the financial crisis may have
prevented the immediate collapse of our financial and auto manufacturing in-
dustries, and improved stability since 2008, the tradeoff is not without profound
long-term consequences. A significant legacy of TARP is increased moral hazard
and potentially disastrous consequences associated with institutions deemed “too
big to fail.”
…
…
…
A recent working paper from Federal Reserve economists confirms that TARP
encouraged high-risk behavior by insulating the risk takers from the consequences
of failure – which is known as moral hazard. The Federal Reserve economists report-
ed how the large banks that received Government bailouts through TARP are now
taking more risks than banks that did not receive taxpayer money.
And before the finance gurus come on here to remind us of the “ FINANCIAL COLLAPSE” boogie man and how we'd all be waiting in the soup line if it wasn't for TARP let me remind you that you are wasting your time convincing me of anything. No one truly knows what would've happened.......and if .gov and/or financial industry was so good at predicting outcomes the “collapse” would not have happened in the first place. So suck it!
http://www.sigtarp.gov/reports/congress/2012/April_25_2012_Report_to_Congress.pdf
After 31⁄2 years, the Troubled Asset Relief Program (“TARP”) continues to be an
active and significant part of the Government’s response to the financial crisis. It
is a widely held misconception that TARP will make a profit. The most recent cost
estimate for TARP is a loss of $60 billion. Taxpayers are still owed $118.5 billion
(including $14 billion written off or otherwise lost). But the analysis should not
be focused alone on money in and money out
..........
...
…
…
…
While TARP and other Government responses to the financial crisis may have
prevented the immediate collapse of our financial and auto manufacturing in-
dustries, and improved stability since 2008, the tradeoff is not without profound
long-term consequences. A significant legacy of TARP is increased moral hazard
and potentially disastrous consequences associated with institutions deemed “too
big to fail.”
…
…
…
A recent working paper from Federal Reserve economists confirms that TARP
encouraged high-risk behavior by insulating the risk takers from the consequences
of failure – which is known as moral hazard. The Federal Reserve economists report-
ed how the large banks that received Government bailouts through TARP are now
taking more risks than banks that did not receive taxpayer money.