Thursday, February 05, 2009

Stealing All Your Money

One weird thing is just how many emailers I get who get angry that I suggest that your money is being stolen.

"Our money - and our economy - are on the line, and we all have a stake in the outcome," said Harvard Law School professor Elizabeth Warren in her prepared remarks for a Senate Banking Committee hearing.

Warren heads the five-member congressional oversight panel overseeing the TARP, and said that the group on Friday will issue a report suggesting Treasury has significantly overpaid for the assets it has purchased from financial institutions. She said an analysis of 10 of the TARP transactions, when extrapolated for all of the purchases made in 2008, suggests Treasury paid $254 billion for assets worth approximately $176 billion, a shortfall of $78 billion.

"Treasury paid substantially more for the assets it purchased under the TARP than their then-current market value," Warren said.

Bailing out these institutions might be necessary, but bailing out executives and shareholders is not.