Has TARP worked?

[427sharpe]

I resist the idea currently floated that ANY firm is 'too big to fail'. I believe that is an absolute myth. IF a mega bank had failed, what would have happened? Assets get bought up by other (better run) firms, liabilities get re-distributed, and the names on the doors change. Instead, we REWARD profligates who ran the company into the shoals! Insanity.

[Excaliber]

Could be, 427sharpe.

I'd have to go with Time magazine's "man of the year" on this one though.

Bernanke: “I think that bankers ought to recognize that the government and the taxpayer saved the financial system from utter collapse last year...

"Government", that would be, as painful as it may be to some, Obama.

[1ntCobra]

Originally Posted by Excaliber

Could be, 427sharpe.

I'd have to go with Time magazine's "man of the year" on this one though.



"Government", that would be, as painful as it may be to some, Obama.

So this TARP thing was Obama's idea? Seems to me that it might have started prior to him taking office.

[Excaliber]

TARP was iniated under Bush, Senator Obama voted for it. Important changes to TARP were made when Obama took office, notably, "accountability". "Strings attached" if you would, that is why the banks are now rushing to pay back the loans. Without the accountability what do you think the odd's are the banks would EVER pay back the loan?

How ironic, Bush must bear major responsibility (being POTUS) for getting us into this mess and at the last minutes of his term scrambles to undo it!

Never the less, the question remains: Was/is TARP successful? Apparently so, but I would not say conclusively so, yet. About half of the money has not yet been released. In addition there are so many "sub programs" of TARP it may be difficult to put a pass or fail grade in a broad and general sense of TARP. The jury is out...

EDIT: Bush's initial TARP program was crucial to stabilizing the country at that time, flawed though the program was. In that regard it was a success and Bush deservedly gets the credit.

[Ron61]

Ernie,

So far overall I think the program is starting to show signs of success. Something had to be done and this seems to be the best idea so far. I agree with what Bernanke said. What surprised me was that Pelosi was even considered to be person of the year let alone making the final few. That has to be partisan politics at its worst. I don't thing we will see the amount of people working that was before this crash again as to many companies have found out they can make it with fewer people and still produce just as much. Last months report here still showed everything going down hill but not as fast as before and some businesses have actually started to turn around.

Ron

[RAZOR]

Originally Posted by Bill Bess

I love history, it provides many examples of man's greatest adventures and failures.
You would think our leaders would use this resource as a reference and guide them to better judgements.
Basics are always the best path, be creative, work hard and pay for what you need and don't barrow on the future.

I too love history and find the wisdom of the Founding Fathers timeless and enduring, only if we could have a few of them with us now. Thomas Jefferson did not trust any bank and thought them to be the bane to our fledgling nation, his view was that they were similar to making your living by playing five card stud,(my analogy not his).He thought it was getting rich quick with little work, and it would ruin the work ethic, his vision was everyone should be a gentleman farmer, so he was more than a little extreme in this vein.

He also said, "It is a wise rule and should be fundamental in a government disposed to cherish its credit, and at the same time to restrain the use of it within the limits of its faculties,never to borrow a dollar without laying a tax in the same instant for paying the interest annually, and the principle within a given term; and to consider that tax as pledged to the creditors on the public faith."

[Excaliber]

Ron,
Bin Laden was considered for "Man of the year" (OK, "person" of the year then ). Hitler WAS "Man of the year". It's not really an award per se, it's recognizing an individual that had the greatest impact on the Nation (perhaps World?), good or bad.

Time Magazine took SO much heat for putting Hitler in there they have shied away from folks that are TO "weird" ever since, (you know, people like Pelosi).

Bernanke has to take some heat along side Bush for the economic disaster. Ben was at the helm when it all went bad, and readily admits he made some serious mistakes. Kind of surprising he actually got a second term in that regard. But RECOGNIZING that he made mistakes and KNOWING how to correct the course laid out is likely his greatest strength!

Pay as you go plan for taxes? Then let's get on with it to fund the Afhganistan war! More war taxes, that's what we need to pay for the surge.

[Ronbo]

There are plenty of regulations that were either ignored or eliminated over the decades that this has been looming, well beyond any one president's term.

Look at the mess pre-911, the NSA knew all about the hijackers and had the Yemin safe house under watch as well as knowlage that something big was coming. Yet they were forbidden to notify the FBI about the terrorists assembling in New Jersey.

The mega corporations work hand in hand with the govenment (the ultimate mega coporation) so these anti-trust laws are BS... NSA tapped into every major AT&T fiber hub throughout the country after 911 and now monitors all internal as well as off-shore communications.

Mega coporations in banking? How about the Federal reserve? (soon to be replaced with the world bank if Obama the UN poster boy has anything to say about it)

Regulation has rarely ever worked, put someone's azz on the line for their actions (no bankruptsies or bail-outs) and actually enforce it. The government does a piss poor job of governing, so why keep throwing money at it? Oh ya, it's not our call. (unless I slept through the healthcare vote and the TARP vote)

Greenspan should be hanging from a tree, right next to Madoff, Barney the homo and a few others. (OK, a lot of others)

[Excaliber]

Imagine a Government where only land owners could vote, women could not, slavery was legal. Our founding Fathers did a terrific job, but they weren't perfect, some "tweaks" along the way are still required.

No way I want Wall Street "unregulated", by the way!!!

[Ronbo]

OK here's one for you, the corps that needed TARP are the one's that can't re-pay it. (like Chrysler)

Yet even with the continued declining economy and freezing of credit as well as the continued forclosures and no improvement in unemployment...

These banks are magically able to pay the loans back...

Answer: The need was fabricated or the money hasn't really been paid back. Since both the government and wall st. are incapable of telling the truth it could be some time before we know.

No doubt wiped out bond holders and retirement accounts are a large source of this newly found wealth, can't see where dumping these forclosures at half their note values was all that profitable.

[Excaliber]

Of course not all the money has been paid back, but it's pretty clear a bunch of it really has and more coming soon. In fact the USA is actually making money from the interest earned on the loans!

Good question though: Where did this money come from? Wiped out bond holders and retirement accounts are a good bet!

[Ronbo]

[quote=Excaliber;1010176]Imagine a Government where only land owners could vote, women could not, slavery was legal. Our founding Fathers did a terrific job. [\QUOTE]

Mainly because of the reasons you've stated...

[RAZOR]

Originally Posted by Excaliber

Imagine a Government where only land owners could vote, women could not, slavery was legal. Our founding Fathers did a terrific job, but they weren't perfect, some "tweaks" along the way are still required.

No way I want Wall Street "unregulated", by the way!!!

Your hind sight is 20/20. Slavery was legal and practiced in EVERY country in the world. Many were against it but went reluctantly along to create the union, they outlawed importation in 1783, that took effect in 25 years(1808).
Thinking it could ween the supporters of slavery, and eventually die out.
Yes in 21st century eyes they were lacking but in their time they were light years ahead of the rest of the world. They accomplished what had never been done before in all of history.In fact the word "republic" was a pejorative term in 18th century thought, it was viewed as a Utopian thought not a possible reality.
They, a bunch of farmers, went up against the super power of the world, and risked everything they owned including their lives, for what they believed.
They knew it was the beginning not the end of what they called "the great experiment" they expected, an demanded the "tweaking".
So the fact they were not perfect is a non sequitur, since in the course of the last 233 years we have failed to reach that status ourselves.

[Ronbo]

Publicly traded stocks have proven to be the most de-stablizing force in our economy for their 100+ years of existance. The temptation of making big bucks real fast is in essence just as addicting as any gambling habit.

Ultimately the goal is to walk off with the public investors money, happens time and time again. Get rid of the stock market, make the businesses borrow only from the financial institutions (no "public offerings") or sell stock directly to investors (eliminate "preferred stock"). Set a fixed mode of operation for the banks and hang those that violate them.

Our (and most everone else's) economy would be incredibly stable if we would just get these gambling houses out of our financial structure.

At least back in '29 people had the decency to jump out the window.

[Dan40]

Originally Posted by Ronbo

Publicly traded stocks have proven to be the most de-stablizing force in our economy for their 100+ years of existance. The temptation of making big bucks real fast is in essence just as addicting as any gambling habit.

Ultimately the goal is to walk off with the public investors money, happens time and time again. Get rid of the stock market, make the businesses borrow only from the financial institutions (no "public offerings") or sell stock directly to investors (eliminate "preferred stock"). Set a fixed mode of operation for the banks and hang those that violate them.

Our (and most everone else's) economy would be incredibly stable if we would just get these gambling houses out of our financial structure.

At least back in '29 people had the decency to jump out the window.

I completely agree that the various world stock markets are the worlds largest Casino. And are not reflective or predictive of any economy. They only show that economic ups and downs tell some that now is the time to make money while others pull back on the same info. That's gambling!

But I completely disagree with even more Government regulation than is already on the books. As in MOST cases, new laws are redundant, if we would actually enforce existing laws, the problems would be solved.

[Dan40]

Originally Posted by Excaliber

TARP was iniated under Bush, Senator Obama voted for it. Important changes to TARP were made when Obama took office, notably, "accountability". "Strings attached" if you would, that is why the banks are now rushing to pay back the loans. Without the accountability what do you think the odd's are the banks would EVER pay back the loan?

How ironic, Bush must bear major responsibility (being POTUS) for getting us into this mess and at the last minutes of his term scrambles to undo it!

Never the less, the question remains: Was/is TARP successful? Apparently so, but I would not say conclusively so, yet. About half of the money has not yet been released. In addition there are so many "sub programs" of TARP it may be difficult to put a pass or fail grade in a broad and general sense of TARP. The jury is out...

EDIT: Bush's initial TARP program was crucial to stabilizing the country at that time, flawed though the program was. In that regard it was a success and Bush deservedly gets the credit.

Was not a major goal of TARP to get the banks to start lending again? Did that happen YET?

I will not say it is all politicians [D's and R's] fault. But for every aspect of the financial and economic crisis, one can find a law that directly applies. Laws that were ignored, unenforced, or replaced repealed better laws. Laws where the enforcement of or ignorance of directly caused or at the very least highly influenced, wrong doing in financial practices.
Can it ALL be laid at the feet of politicians? No, the public's complicity was a factor too. People making deals that idiots could tell were not possible in the long run. But LAWS allowed them to do it.