There's more! There was GM! Some of the money the US Treasury 'invested' in GM may not get paid back. So, we might say that GM got 'bailed out'. Hmm. As I

There's more! There was GM! Some of the money the US Treasury 'invested' in GM may not get paid back. So, we might say that GM got 'bailed out'. Hmm. As I understand it, there was a little more to the story: One approach to GM was just to let it go through an ordinary bankruptcy. But DC didn't want that. Why? My understanding is that in an ordinary bankruptcy, GM would have gotten off the hook in their labor contracts to pay for retirees' health and pensions but, then, by law, the US Federal Government, that is, taxpayers, would have to make up the difference. So, if all these guesses at the facts are correct, then, net, the 'arranged' bankruptcy essentially wiped out the stockholders, cost the Treasury some money, gave much of GM to the UAW pension and health care funds, and got the US Treasury off the hook for propping up ('bailing out') the UAW pension and health funds, then maybe, net, the Treasury came out best possible! So, when there is screaming about the 'bailout' of GM, remember that the final arrangement was likely the "lesser of two weevils". For the GM stockholders, well, GM messed up big time. So, first cut, in simple terms, it was up to the owners, that is, the stockholders to take the loss. For a real 'bailout', there is Solyndra, ESPECIALLY after the renegotiation that had the taxpayers go from being first in line to get paid to being last in line to get paid. And AIG was a real 'bailout'. The idea of bailing out AIG was to stop the spread of the sickness just at AIG. In part AIG was a bailout because it was not at all clear that AIG could repay. Last I heard, AIG may actually, finally, by slowly selling off everything it had, including its pens and pencils in Hong Kong, be able to pay back all the Federal bailout money. It was still a bailout. But TARP, no, that was a vulture capital loan from the lender of last resort, the US Treasury, not 'help', not a 'gift', not really at risk, and not really a 'bailout'. Of course, in all of this, the real villain is DC and what it did, especially having Fannie and Freddie back junk paper, in blowing the housing bubble. Why was the bubble so bad? Because during the price rising, there was a lot of dirty mortgage manipulations going on. But mostly the problem was that when the bubble burst, the 'reserve capital' of much of our banking system was wiped out and about 50% of the houses in the US went 'underwater'. So, we drained the financial capital lubricating oil out of the crankcase of our economic engine; the engine stopped; and millions of people in the US were seriously hurt. Here's the situation: Banks will make loans on assets. But if the banks make enough loans on just some focused assets, then the asset values will rise which will let the banks make more loans on those assets, ..., and we blow a bubble. Then when the last loan is made, prices start to fall; the banks don't get paid back; the financial system dies; and the economy dies. So, really, don't want banks making loans on 'financial assets'. Well, for stocks, after the Great Depression, we stopped that. But with housing, essentially the same scam got started again, with the help of Fannie and Freddie. Fannie and Freddie, along with the Federal Reserve, along with major parts of DC cheering it all on, were the real problem. The last time we did that, a wacko house painter and some of his buddies killed 50 million people, or maybe it was 100 million, I can't remember just exactly. We shouldn't do such things. The media should keep us informed so that we don't.