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Politics : Politics of Energy -- Ignore unavailable to you. Want to Upgrade?

To: Road Walker who wrote (7439)	4/23/2009 2:08:45 PM
From: Brumar89	Respond to of 86356

The programs described in the article you posted are mostly loan programs* or loan or deposit guarantee programs. Yes, they're not being used as much as anticipated because of what I described - the big strings the Obama adm have attached. Which is why you can say "the vast majority of the funds have not been 'loaned'". * And most of the government rescue packages offered to the banks have gone untapped or are being repaid. ..... Banks have tapped the FDIC's Temporary Liquidity Guarantee Program for $297 billion so far. That's about 20% of the total $1.5 trillion allocated. This is the biggest of the government programs, and banks pay 0.5% to 1% interest for the right to borrow the money depending on how long they keep it. During its first month, the Term Asset-Backed Securities Loan Facility, or TALF, has only financed $4.7 billion in consumer debt, far below the $1 trillion allocated. ..... Other than the stimulus bill, the program with the biggest outlay so far is the Troubled Asset Relief Program, or TARP. More than $570 billion has been committed, but less than $400 billion has actually left the Treasury Department. Like most of these programs, it's unclear how much of this money will be repaid, but most banks say they're either ready or capable of giving it back. If not, they have to pay a 5% annual dividend to the government. In just the first three months of this year, the government has collected $2.52 billion in TARP interest. You get the idea. Most of these programs were designed as backstops and as proof that the government stands behind the country's private financial system. The government is extending its own credit line to banks until the private sector can repair its own.