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Photo reblogged from MONEY, CASH, HO'S by David Cho with 38 notes
I love how Pixar incorporates my old stomping grounds into its films. Carl and Ellie’s house from Up was inspired by a string of houses just off of Sixth Street in Berkeley. The SFGate may have found it. (thanks davidcho)
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Tuesday TARP Day
The big news of today was all about the repayment of the TARP funds.
If you recall, the Troubled Asset Relief Program was part of the $700 billion Bailout Plan whereby the government saved our troubled banks by injecting about $200 billion in return for equity shares. That was back in October 2008 and initial estimates held that only about $25 billion would be repaid in 2009.
But today 10 banks announced they will pay back $68.3 billion of it. Each raised enough capital and/or passed the “stress tests” (which determine how much money the bank will need to survive in the event of economic collapse), and the Treasury has thus granted them permission to repay.
Apparently, this repayment is a signal of improving conditions and that the new financial recovery plans are working (or so they tell us).
But The Big Picture takes another view:
The rush to repay TARP monies gives us another opportunity to consider why the hell this absurd financial giveaway ever happened in the first place. A close inspection suggests some dishonesty on the part of the prior Treasury Secretary.From its inception, the TARP never made much sense. Forcing banks that did not need money to accept government bailouts was simply irrational.
In Bailout Nation, we discuss the possibility that The TARP was all a giant ruse, a Hank Paulson engineered scam to cover up the simple fact that CitiGroup (C) was teetering on the brink of implosion. A loan just to Citi alone would have been problematic, went this line of brilliant reasoning, so instead, we gave money to all the big banks.
I love conspiracy theories. Except when they involve my money!
friends over at goodeater.org created a food scare timeline. scary! a comprehensive list of recalls is also available on the fda website.
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0.000000435%
is roughly the percent of GM that we each own.
$362 is what each of us paid for that equity stake.
That’s because $50,000,000,000 is the total amount the US Treasury has spent of GM’s survival. (That’s $30.1 billion for 60% of New GM’s equity + $20.6 billion that we spent trying to keep them out of bankruptcy.) And that’s just the beginning of it.
So $83,000,000,000 is what New GM would have to be worth in order for us to break even on our investment.
But $56,000,000,000 is what GM was worth at its all time peak in 2000.
And it’s only worth about $7,300,000,000 now.
So New GM would have to have about a 48% increase in value from its all time peak. Likely?
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they’re all gonna laugh at you, they’re all gonna laugh at you
You may have heard that Geithner, the US Secretary of Treasury, went to China this week to assuage the Chinese government’s concerns about US Treasury securities. See, China is one of the largest buyers of US Treasury securities, owning over trillions of dollars of government bonds. We rely on them to buy more bonds in order to strengthen our budget, but they’re concerned about the value of their investments and the strength of the declining US dollar. The dollar index, which measures the performance of the dollar against other currencies, saw the largest monthly decline in almost 25 years in May. And typically US government bonds are the safest investments and are considered “risk-free.”
So Mr. Geithner Goes to China (no doubt there will be a book written about it with this as its title) to convince them that investment in US securities is in their best interest, that we are turning around, that the Obama Administration’s intent is to “go back to living within our means; that we bring our fiscal deficits down to a sustainable level; that we unwind and reverse these exceptional measures we’ve taken in the financial sector.”
You may have heard that. But what you may not have heard was how he was laughed at. Apparently he did not just “elicit some laughter” as the NYTimes cursorily described, he was straight up laughed at. The American press did not necessarily pick up on the importance of this. Instead, they pegged the meetings as successful. But as The Telegraph describes, “US Treasury Secretary Tim Geithner was laughed at by an audience of Chinese students after insisting that China’s US assets are safe…. The comment provoked loud laughter from the audience…” We’re a laughingstock! A bit disconcerting.
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