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Capitalize profits socialize losses that is American corporate way. Executives keep the profit and expect taxpayers to bailout losses.
by akg_67 7y ago
Capitalize profits socialize losses that is American corporate way. Executives keep the profit and expect taxpayers to bailout losses.
- aantix 7y ago"Barack Obama says banks paid back all the federal bailout money" https://www.politifact.com/factchecks/2012/oct/25/barack-obama/barack-obama-says-banks-paid-back-all-federal-bail/ https://www.politifact.com/factchecks/2012/oct/25/barack-oba...
- Retric 7y agoOpportunity cost, the banks in no way payed out what that money was worth at the time. Hand me 1 billion interest free for 5 years and sure I will pay the money back, but...
- yyy888sss 7y agoYes but assuming bankruptcy would have actually destroyed the US economy (highly debatable) then it was a low cost measure.
- vonmoltke 7y agoIt was not interest-free: https://projects.propublica.org/bailout/list https://projects.propublica.org/bailout/list
- Retric 7y agoAs that points out, not all loans where paid back. The interest from those that did result in a nominal profit, but it’s far from what private lenders received for loans in that time period. Thus opportunity cost, as it was a poor investment which is why it was called a bailout.
- aantix 7y agoIf they had other opportunities at higher rates, they would have lent at that rate.
- yohannparis 7y agoTrue, but still mean that the people bail them out. So the taxpayers soften the blow with a loan... Maybe let the companies go down, and give a loan to the taxpayers instead.
- wmeredith 7y agoThe TARP bailouts turned over $10bill profit.
- akg_67 7y agoHow much TARP invested and how much it profited. Now compare that with how much Warren Buffett invested in Goldman Sachs and how much he profited. No wonder GS decided to become bank, access to taxpayers money is much cheaper.