Thread: Government to profit $8billion on Citibank bailout; 2nd largest stock profit ever

Originally Posted by ericams2786

I love how with liberals if the government makes a profit it's wonderful and if a company makes a profit they are "evil".

8 billion is that not and OBSCENE profit, and will the goivernment have to pay a tax on the earnings? heh....

Originally Posted by MattInFla

Before we get real excited about how much "profit" the bailout made, don't we need to examine how much intrest we paid on the money we borrowed to loan Citibank in the first place?

If they returned it at 8% and we borrowed it at 8%, the ends result is a wash, no?

Matt

shush, why ya have to burst danny's bubble he was having so much fun

Originally Posted by MattInFla

Before we get real excited about how much "profit" the bailout made, don't we need to examine how much intrest we paid on the money we borrowed to loan Citibank in the first place?

If they returned it at 8% and we borrowed it at 8%, the ends result is a wash, no?

Matt

This wasn't a loan, it was a stock purchase.

Treasuries have not been at 8% since Clinton was president.
Long term rates have been around 4%, and short term rates less than 1%.

The government paid 25 billion for the stock, it's now worth 33 billion, it's been a little over a year, call it a year and a half, and it's around a 20% annual return, at a cost of 4%, or around 1.5 billion in interest. That's a net surplus
of 6.5 billion after expenses. Pretty good, you can see why most Republicans voted against it.

That's if they funded it with long term borrowing, if they funded it with short term borrowing the net surplus is over 7 billion.

Originally Posted by goober

This wasn't a loan, it was a stock purchase.

Treasuries have not been at 8% since Clinton was president.
Long term rates have been around 4%, and short term rates less than 1%.

The government paid 25 billion for the stock, it's now worth 33 billion, it's been a little over a year, call it a year and a half, and it's around a 20% annual return, at a cost of 4%, or around 1.5 billion in interest. That's a net return of 6.5 billion after expenses. Pretty good, you can see why most Republicans voted against it.

Cherry picking one positive outcome amid hundreds of negative ones does not constitute successful policy, Goober, and that is what has happened here. A lot of the big banks that received TARP didn't need it. The smaller regional banks that were in trouble could have used it and got little or nothing. Then there is also the billions that was used to pay off foreign bank debt. Foreclosures skyrocketed after TARP. I could on, but you get the picture. Actually, you probably don't get it, but everyone else understands.

Like all administrations, Obama is squawking about the one thing that makes him look good while ignoring the hundreds of others that make him look bad.

Originally Posted by Danny

No need! That plan is paid for! OOOO Snap!



Huh? Is there any evidence (I'll even take right wing nut job websites) that you can provide which suggests a liberal saying that a company that makes profit is evil, ever? Gouging is evil, gaming the system is evil, but I think you'll be hard pressed to back up that false blanket statement there buddy boy (which is even being touted as logic in this thread lol).

Your f***ing kidding right? I mean all we hear constantly is demonizing of one company to the next, from Exxon to health insurance companies - that's all we hear from the left. We hear about how bad profit is, how bad capitalism is, how bad CEO's are. And you seriously need evidence. Holy crap, just watch MSNBC for like hell I don't know 10 minutes and you'll have your evidence.

This shows ABC and CBS pushing the "demonization of profit":
ABC Pushes Obama?s Insurance Demonization; Couric Asserts Summit ?Much-Anticipated? | NewsBusters.org

This from the AFL-CIO siting a totally unbiased report from Health Care for America Now
AFL-CIO NOW BLOG | Health Insurance Profits Soar as Industry Mergers Create Near-Monopoly

As Congress sleeps health insurance profits skyrocket ?coverage plummets - Rick Ungar - The Policy Page - True/Slant

Obama calls for taxing big oil windfall profits; send $500 to needy individuals. - Lynn Sweet

The Huffington Post: The Insurance Industry’s Lethal Bottom Line — and a Solution From Sens. Franken and Rockefeller | Al Franken - U.S. Senator, Minnesota

Think Progress:

Think Progress Health Insurance Industry Defends Massive Profits, Complains It Is Being ‘Vilified’

And the Huffington Post:

Ian Welsh: Americans Lives vs. Insurance Company Profits: The Real Battle in Health Care Reform

Protect Insurance Companies PSA: Will Ferrell, Jon Hamm Speak Out Against The Public Option (VIDEO)

Alan Rosenblatt: Big Oil Big on Profits, Small on American Values

Now do I really need more. There are literally thousands of examples I'm sure of this demonization of profit that comes from the left constantly.

Originally Posted by goober

This wasn't a loan, it was a stock purchase.

Treasuries have not been at 8% since Clinton was president.
Long term rates have been around 4%, and short term rates less than 1%.

The government paid 25 billion for the stock, it's now worth 33 billion, it's been a little over a year, call it a year and a half, and it's around a 20% annual return, at a cost of 4%, or around 1.5 billion in interest. That's a net surplus
of 6.5 billion after expenses. Pretty good, you can see why most Republicans voted against it.

That's if they funded it with long term borrowing, if they funded it with short term borrowing the net surplus is over 7 billion.

how about the cost involved in running tarp?

let call that the comission..

ohh and since you are happy about this does that mean you are a BUSH supporter?

Originally Posted by SamInTheSouth

Cherry picking one positive outcome amid hundreds of negative ones does not constitute successful policy, Goober, and that is what has happened here. A lot of the big banks that received TARP didn't need it. The smaller regional banks that were in trouble could have used it and got little or nothing. Then there is also the billions that was used to pay off foreign bank debt. Foreclosures skyrocketed after TARP. I could on, but you get the picture. Actually, you probably don't get it, but everyone else understands.

Like all administrations, Obama is squawking about the one thing that makes him look good while ignoring the hundreds of others that make him look bad.

I'm not cherry picking, I'm responding to something directed at this very transaction, in a thread devoted to this one transaction.

Trying to change the focus when the facts bitch slap your dogma is lame.

If you would like to discuss the rest of the TARP, why not get the facts and figures and make a thread devoted to that topic.

Originally Posted by John Drake

Depends. Would be in groceries, where the average is less than 1%

Figures that themselves vary by 100% are virtually meaningless in any case.

ahhhhh yes, so is a 1% profit what you'll allow us to make commissar?

Originally Posted by goober

I'm not cherry picking, I'm responding to something directed at this very transaction, in a thread devoted to this one transaction.

Trying to change the focus when the facts bitch slap your dogma is lame.

If you would like to discuss the rest of the TARP, why not get the facts and figures and make a thread devoted to that topic.

That is weak, and you know it.

You are playing the fool by supporting Danny on this thread.

It doesn't matter if the government actually made money bailing out Citi, because they will lose all of that, and a whole lot more, on Fannie, Freddie, GM, etc.

Argue for TARP because you believe that it was a necessary expenditure to save the financial system, if you must, but argue for TARP because it is going to MAKE the government money, and you look like a liberal fool who has no understanding of economics.

Originally Posted by Danny

No need! That plan is paid for! OOOO Snap!

Danny, you really should know better than to believe that. What are you, 23, 24 years old?

Originally Posted by MattInFla

Before we get real excited about how much "profit" the bailout made, don't we need to examine how much intrest we paid on the money we borrowed to loan Citibank in the first place?

If they returned it at 8% and we borrowed it at 8%, the ends result is a wash, no?

Matt

More importantly, we need to examine how much was lost in other investments like Fannie, Freddie, GM, etc.

Originally Posted by smurf

More importantly, we need to examine how much was lost in other investments like Fannie, Freddie, GM, etc.

Fannie & Freddie will always be a burden on us because their whole point is to provide affordable housing to the less fortunate... we all know how well all of our social welfare programs have worked out (ie: Medicare/Social Security... and now health care Jesus Christ were gonna be broke by 2012) so I mean those companies are always going to be bleeding our tax dollars but what are you gonna do I they were both made either before I was born or when I was like 4 so I had no say in it plus you have to remember that the people who these programs/quasi-gov companies benefit (who are actually a shitton of people) will always press their politicians to keep it up so I don't think there going anywhere anytime soon.... the bailout IMO was kind of necessary though I mean back in the 1920's Hoover did nothing during his recession and we all know how well that turned out for us

Originally Posted by NYorker

Fannie & Freddie will always be a burden on us because their whole point is to provide affordable housing to the less fortunate... we all know how well all of our social welfare programs have worked out (ie: Medicare/Social Security... and now health care Jesus Christ were gonna be broke by 2012) so I mean those companies are always going to be bleeding our tax dollars but what are you gonna do I they were both made either before I was born or when I was like 4 so I had no say in it plus you have to remember that the people who these programs/quasi-gov companies benefit (who are actually a shitton of people) will always press their politicians to keep it up so I don't think there going anywhere anytime soon.... the bailout IMO was kind of necessary though I mean back in the 1920's Hoover did nothing during his recession and we all know how well that turned out for us

nothing wrong with a nice quick depression.. a long recession where liberals expand government power is a lot worse.

Originally Posted by CSA

nothing wrong with a nice quick depression.. a long recession where liberals expand government power is a lot worse.

Well, that certainly speaks volumes about your knowledge of economics............

Care to point out a historical example of "a nice quick depression"?

Originally Posted by CSA

nothing wrong with a nice quick depression.. a long recession where liberals expand government power is a lot worse.

You don't know this. Noone does. This claim is nothing but baseless assumptions. There is noone in the world who knows what's going to happen if a "nice" quick depression hits America. For one you don't know if it's going to be a quick depression, second you don't know the damages it will costs (again noone knows) and third you don't know how bad expanding of government by liberals is (american government has been expanded by almost every president).