I think you're confusing TARP, which is basically a loan program, with expenses. TARP is a purchase of assets (Troubled Asset Relief Program), many of which are expected to recover. When the credit freeze happened, many worthy credits were trapped. It's called a "bailout" because it allowed banks to sell -- at rock bottom prices! -- assets that they couldn't otherwise sell, because who would buy them at that time? It wasn't to cover losses at the banks; it was to stop the losses from continuing.
They thought that they might have to buy up to $700B of assets, but it turned out to be a lot less (this is the subject of the above quote). And many of the assets purchased have appreciated significantly in the last two years, so much so that the gains may ultimately erase the losses (of course some of the credits were indeed stinkers). Treasury, through TARP, became a giant hedge fund.
As in any asset purchase, this isn't a "cost" -- it's an exchange of assets with the net result that Treasury became a holder of debt.
What you're talking about is to purchase ("take care of") the *expenses* of the States, which isn't anywhere on the radar.
^^^^^^ CB; I don't know, comrade. This doesn't sound like ruthless criticism of all this. Even "they" didn't say it was a "bailout" . Allowing them to sell at a rock bottom price doesn't sound like a loan. Sounds like a gift through price-fixing. Also, why would the Financial Times give a figure like $12 trillion for the bailout ?
Anyway, if it's a loan program , they could loan $200 billion to the states and cities, at very low interest rate with a long payback.
Also, if this was all just a loan, why were people here getting on Obama for not expropriating the banks ?
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