The Troubled Asset Relief Program ("TARP") represents a massive and unprecedented investment of taxpayer money designed to stabilise the financial industry and promote economic recovery. The long-term success of the program is not assured. Success -- or failure -- will depend on whether the Department of the Treasury has spent, and will spend in the future, that massive investment wisely and efficiently to attain the program's goals. While it is too early to draw any conclusions on that ultimate issue, this assessment must necessarily begin with an understanding of what the Treasury has done thus far. The goal of this book is to present a ready reference on what TARP is and how it has been used, at least for the first $350 billion authorised as of January 23, 2009. This book consists of public domain documents which have been located, gathered, combined, reformatted, and enhanced with a subject index, selectively edited and bound to provide easy access.
The Troubled Asset Relief Program (TARP) was created by the Emergency Economic Stabilization Act1 (EESA) enacted on October 3, 2008. EESA was passed by Congress and signed by President George W. Bush to address an ongoing financial crisis that reached near-panic proportions in September 2008.
Financial crises are recurring phenomena that result in the financial distress of systemically important banks, making it imperative to understand how to best respond to such crises and their consequences. Two policy responses became prominent for dealing with these distressed institutions since the last Global Financial Crisis: bailouts and bail-ins. The main questions surrounding these responses touch everyone: Are bailouts or bail-ins good for the financial system and the real economy? Is it essential to save distressed financial institutions by putting taxpayer money at risk in bailouts, or is it better to use private money in bail-ins instead? Are there better options, such as first lines of defense that help prevent such distress in the first place? Can countercyclical prudential and monetary policies lessen the likelihood and severity of the financial crises that often bring about this distress? Through careful analysis, authors Berger and Roman review and critically assess the extant theoretical and empirical research on many resolution approaches and tools. Placing special emphasis on lessons learned from one of the biggest bailouts of all time, the Troubled Asset Relief Program (TARP), while also reviewing other programs and tools, TARP and Other Bank Bailouts and Bail-Ins around the World sheds light on how best to protect the financial system on Wall Street and the real economy on Main Street.
In October 2008, the Emergency Economic Stabilization Act of 2008 established the Troubled Asset Relief Program (TARP), which authorizes the Department of the Treasury to purchase or insure troubled assets as a way to promote stability in financial markets. Section 202 of that legislation requires a report on those transactions This is the third statutory report on TARP¿s transactions. Charts and tables.
October 3, 2010 marked the second anniversary of the creation of TARP and the end of the authority to make new financial commitments. The government now has recovered most of the investments it made in the banks. Taxpayers will likely earn a profit on the investments the government made in banks and AIG, with TARP losses limited to investments in the auto industry and housing programs. Contents of this report: TARP Overview; Stabilization of the Financial Markets; TARP Program Descriptions; Retrospective on the TARP Housing Initiatives; Executive Compensation; U.S. Government as a Shareholder; Accountability and Transparency. Charts and tables. This is a print on demand edition of an important, hard-to-find report.
Assistance provided by the Dept. of the Treasury under TARP, and the Board of Governors of the Federal Reserve System to Amer. International Group, Inc. (AIG) represents one of the federal government's largest investments in a private-sector institution since the financial crisis began in 2008. AIG is a holding company that, through its subsidiaries, engaged in a broad range of insurance and insurance related activities in the U.S. and abroad. This report discusses: (1) trends in AIG's financial condition; (2) trends in the unwinding of AIG Financial Products and the financial condition of AIG's insurance companies; and (3) the status of the government's exposure to AIG. Charts and tables. This is a print on demand report.
The financial crisis that gripped the U.S. in 2008 was unprecedented in type and magnitude. It began with an asset bubble in housing, expanded in the sub-prime mortgage crisis, escalated into a severe freeze-up of the inter-bank lending market, and culminated in intervention by the U.S. and other industrialised countries to rescue their banking systems. The centrepiece of the federal government's response to the financial crisis was the Emergency Economic Stabilization Act of 2008 (EESA), which authorised the Treasury Secretary to establish the $700 billion Troubled Asset Relief Program (TARP) and created the Congressional Oversight Panel to oversee the TARP. This book examines the Congressional Oversight Panel's assessment of TARPS's progress at the end of its first full year existence, and reviews what TARP has accomplished to date and explores where it has fallen short.
The New York Times bestseller "Blinder's book deserves its likely place near the top of reading lists about the crisis. It is the best comprehensive history of the episode... A riveting tale." - Financial Times One of our wisest and most clear-eyed economic thinkers offers a masterful narrative of the crisis and its lessons. Many fine books on the financial crisis were first drafts of history—books written to fill the need for immediate understanding. Alan S. Blinder, esteemed Princeton professor, Wall Street Journal columnist, and former vice chairman of the Federal Reserve Board, held off, taking the time to understand the crisis and to think his way through to a truly comprehensive and coherent narrative of how the worst economic crisis in postwar American history happened, what the government did to fight it, and what we can do from here—mired as we still are in its wreckage. With bracing clarity, Blinder shows us how the U.S. financial system, which had grown far too complex for its own good—and too unregulated for the public good—experienced a perfect storm beginning in 2007. Things started unraveling when the much-chronicled housing bubble burst, but the ensuing implosion of what Blinder calls the “bond bubble” was larger and more devastating. Some people think of the financial industry as a sideshow with little relevance to the real economy—where the jobs, factories, and shops are. But finance is more like the circulatory system of the economic body: if the blood stops flowing, the body goes into cardiac arrest. When America’s financial structure crumbled, the damage proved to be not only deep, but wide. It took the crisis for the world to discover, to its horror, just how truly interconnected—and fragile—the global financial system is. Some observers argue that large global forces were the major culprits of the crisis. Blinder disagrees, arguing that the problem started in the U.S. and was pushed abroad, as complex, opaque, and overrated investment products were exported to a hungry world, which was nearly poisoned by them. The second part of the story explains how American and international government intervention kept us from a total meltdown. Many of the U.S. government’s actions, particularly the Fed’s, were previously unimaginable. And to an amazing—and certainly misunderstood—extent, they worked. The worst did not happen. Blinder offers clear-eyed answers to the questions still before us, even if some of the choices ahead are as divisive as they are unavoidable. After the Music Stopped is an essential history that we cannot afford to forget, because one thing history teaches is that it will happen again.
