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Reply #20: You'd be Paying a Lot More Without TARP [View All]

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On the Road Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Jan-15-11 11:20 AM
Response to Reply #18
20. You'd be Paying a Lot More Without TARP
Edited on Sat Jan-15-11 11:22 AM by On the Road
If AIG repays the loans fully, that leaves the government on the hook for a few small banks. It's about the cheapest financial meltdown you can imagine.

IF AIG failed and took down some major banks, the cost in lost tax revenue, not to mention FDIC insurance payments, would be in the hundreds of billions or most likely trillions.

Bear Stearns and Lehman Brothers were lesson territory, and that was almost too much for the system. Economic life as we know it would most likely not exist if the system crashed.
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  -AIG to fully repay U.S. government RamboLiberal  Jan-12-11 10:52 PM   #0 
  - So they are repaying nothing. They're trading old stock for new.  mbperrin   Jan-12-11 11:00 PM   #1 
  - They're Converting the Convertible Preferred Stock  On the Road   Jan-12-11 11:28 PM   # 
  - It really has turned out to be quite a success  Yupster   Jan-13-11 12:01 AM   #4 
  - And the RIGHT says Government NEVER does anything correct. nt.  SkyDaddy7   Jan-13-11 04:36 AM   #5 
  - Easily? How does one sell 92% of stock without massively devaluing the shares?  Fool Count   Jan-13-11 06:34 AM   #7 
  - That's Correct, You Would Never Sell 92% of the Shares Immediately  On the Road   Jan-13-11 11:04 AM   #9 
  - "Over time" - not cash, is it? And would result in a loss if sold at once.  mbperrin   Jan-13-11 07:02 AM   #8 
  - Stock is an Asset  On the Road   Jan-13-11 11:06 AM   #10 
     - So my incentive is to get myself completely broke and out of cash,  mbperrin   Jan-13-11 11:18 AM   #12 
        - AIG Lost Billions  On the Road   Jan-13-11 12:09 PM   #14 
           - I wish they had let them fail as a lesson to others tempted to do the  mbperrin   Jan-13-11 12:54 PM   #15 
              - Everything That Has Come Out About the Derivatives Meltdown  On the Road   Jan-13-11 03:02 PM   #17 
                 - Well, we should have let it come down, and the next generation  mbperrin   Jan-13-11 07:40 PM   #18 
                    - You'd be Paying a Lot More Without TARP  On the Road   Jan-15-11 11:20 AM   #20 
                       - I'd pay nothing if my solution had be enacted. The stockholders of those  mbperrin   Jan-15-11 01:42 PM   #22 
                          - It was Widely Believed at the Time  On the Road   Jan-16-11 12:32 PM   #23 
                             - Yet I didn't believe it at that time and still don't.  mbperrin   Jan-16-11 01:33 PM   #25 
  - How would the system of payments frozen had AIG been allowed to fail?  brentspeak   Jan-13-11 08:11 PM   #19 
  - No doubt. Thank goodness for the vision of George W. Bush!  Rage for Order   Jan-15-11 01:20 PM   #21 
  - dupe  On the Road   Jan-12-11 11:28 PM   #2 
  - See? Those billions in year-end bonuses to CEO's are finally paying off!  chollybocker   Jan-12-11 11:57 PM   #3 
  - "In Full" in What Way?  Demeter   Jan-13-11 05:58 AM   #6 
  - I just spit my cereal out all over my keyboard...  IScreamSundays   Jan-13-11 11:10 AM   #11 
  - OK so let's wait for the next screwup  faz   Jan-13-11 12:07 PM   #13 
  - the big question on everyone's mind  melm00se   Jan-13-11 01:28 PM   #16 
  - It would be interesting to see some of the posts on this site from about year or so ago claiming...  DCBob   Jan-16-11 12:43 PM   #24 
  - Is something askew here?  SOS   Jan-16-11 02:00 PM   #26 

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