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Politics : President Barack Obama -- Ignore unavailable to you. Want to Upgrade?

To: steve harris who wrote (117613)	7/30/2012 6:47:23 AM
From: Sr K	Read Replies (3) \| Respond to of 149317

Meanwhile, all of the toxic assets remain on the books today. The original TARP couldn't work because banks wouldn't sell the assets for 20 cents on the Dollar, and buyers wouldn't buy them for 60 cents on the Dollar. It was quickly and readily obvious they were at an impasse. Today they are back to 60 cents or more, so the banks that were unwilling to sell for 20 cents were right. The indirect way Treasury did it was to flow the $700 billion to the banks, with the banks issuing senior preferred stock. Those securities, now mostly repaid, paid 5% preferred stock dividends and the banks issued warrants when they issued the preferred stock. From the dividends and the warrants, the U.S. Treasury now has a $20 billion projected profit. The TARP has been almost fully repaid. The toxic assets are mostly not on the books today. Banks that survived have allowances for those that were valued too high.