Sponsored Content
« Funemployment Now At 10.2% | Main | Officer Who Shot Hasan Identified »
November 06, 2009

Fed Quietly put 4.3 Trillion at risk. [krakatoa]

We all knew about TARP, where over 700 Billion taxpayer dollars were used with little oversight to "prevent a Depression !!!"

Now the AP reports that the Treasury actually had access to 6 times that amount, with zero oversight.

At the peak of the financial crisis, taxpayer money guaranteed assets worth $4.3 trillion to help banks ride out the panic. The programs, which essentially provided insurance against losses, helped stabilize financial markets but put far more taxpayer dollars at risk than Congress intended, according to the Congressional Oversight Panel.

Many would say these actions saved the economy. There is an argument to be made there, and make no mistake, that debate will be forefront in next year's elections.

What isn't debatable is that there were many draconian steps taken, and many instances like this where the assets of a relative few were not only uniquely protected, but given a risk-free return on investment while the average investors had to take their lumps in the open market.

For example, when a major money market mutual fund threatened to "break the buck" last year, the Treasury Department temporarily guaranteed its assets to reassure investors that their money was safe. The actions spared investors the downside of their risk while allowing them to earn better returns than they would have in a normal deposit account.

In an ideal world, When the government steps in it can do great good, but only in very specific and targeted directions. And only so long as it is a transparent process that does not arbitrarily pick favorites at the expense of others.

We don't live in an ideal world like that, and we never will. The government simply should not be involved in the private sector, as the potential downside is absolutely disastrous.

In this case, the worst that could have happened was a stealth quadrupling of the Trillion-plus deficit we currently toil under.

Imagine what effect that would have on the U.S. and the World economies.


digg this
posted by xgenghisx at 10:22 AM

| Access Comments




Recent Comments
bill in arkansas, not gonna comply with nuttin, waiting for the 0300 knock on the door : "I had to go through downtown Fort Smith after the ..."

Captain Obvious, Laird o' the Sea, Radioactive Knight: "Couldn't have wagyu stock using up all the makeup ..."

That Northern skulker: "I'm feeling kind of gloomy and unsolvable at this ..."

Mister Scott (Formerly GWS): "Japan seems like an odd place, with hyper-dense, h ..."

Cicero (@cicero43): "Gotta massage them cows and feed them only the fin ..."

JackStraw: "I went to my towns Memorial Day Parade. It was rea ..."

CppThis: "47 Ronin may be bleak, but it's also manly as hell ..."

Notorious BFD: "[i]How did you observe Memorial Day?[/i] With p ..."

Dr. Bone: "Thank the heavens we never made it as far as Tom's ..."

Gen. Curtis LeMay: "Samurai City Cafe ------------- Those buil ..."

Jewish-Japanese fusion cuisine enthusiast: "I'll have a pastrami on samurye. ..."

Mr Aspirin Factory: ""How did you observe Memorial Day?" Moved #5 ri ..."

Recent Entries
Search


Polls! Polls! Polls!
Frequently Asked Questions
The (Almost) Complete Paul Anka Integrity Kick
Top Top Tens
Greatest Hitjobs

The Ace of Spades HQ Sex-for-Money Skankathon
A D&D Guide to the Democratic Candidates
Margaret Cho: Just Not Funny
More Margaret Cho Abuse
Margaret Cho: Still Not Funny
Iraqi Prisoner Claims He Was Raped... By Woman
Wonkette Announces "Morning Zoo" Format
John Kerry's "Plan" Causes Surrender of Moqtada al-Sadr's Militia
World Muslim Leaders Apologize for Nick Berg's Beheading
Michael Moore Goes on Lunchtime Manhattan Death-Spree
Milestone: Oliver Willis Posts 400th "Fake News Article" Referencing Britney Spears
Liberal Economists Rue a "New Decade of Greed"
Artificial Insouciance: Maureen Dowd's Word Processor Revolts Against Her Numbing Imbecility
Intelligence Officials Eye Blogs for Tips
They Done Found Us Out, Cletus: Intrepid Internet Detective Figures Out Our Master Plan
Shock: Josh Marshall Almost Mentions Sarin Discovery in Iraq
Leather-Clad Biker Freaks Terrorize Australian Town
When Clinton Was President, Torture Was Cool
What Wonkette Means When She Explains What Tina Brown Means
Wonkette's Stand-Up Act
Wankette HQ Gay-Rumors Du Jour
Here's What's Bugging Me: Goose and Slider
My Own Micah Wright Style Confession of Dishonesty
Outraged "Conservatives" React to the FMA
An On-Line Impression of Dennis Miller Having Sex with a Kodiak Bear
The Story the Rightwing Media Refuses to Report!
Our Lunch with David "Glengarry Glen Ross" Mamet
The House of Love: Paul Krugman
A Michael Moore Mystery (TM)
The Dowd-O-Matic!
Liberal Consistency and Other Myths
Kepler's Laws of Liberal Media Bias
John Kerry-- The Splunge! Candidate
"Divisive" Politics & "Attacks on Patriotism" (very long)
The Donkey ("The Raven" parody)
Powered by
Movable Type 2.64