Paulson's Bailout Investment Terms Worse Than Comparable Private Ones, Bloomberg Says

Jan. 9 (Bloomberg) -- Henry Paulson may be the most powerful manager of money in the world and he still couldn't do for taxpayers with the $700 billion bailout of American banks what Warren Buffett did for his shareholders in investing in Goldman Sachs Group Inc.

The Treasury secretary has made 174 purchases of banks' preferred shares that include certificates to buy stock at a later date. He invested $10 billion in Goldman Sachs in October, twice as much as Buffett did the month before, yet gained warrants worth one-fourth as much as the billionaire, according to data compiled by Bloomberg. The Goldman Sachs terms were repeated in most of the other bank bailouts.

Paulson's warrant deals may give U.S. taxpayers, who are funding the bailouts, less profit from any recovery in financial stocks than shareholders such as Goldman Sachs Chief Executive Officer Lloyd Blankfein and Saudi Arabian Prince Alwaleed bin Talal, owner of 4 percent of Citigroup Inc., said Simon Johnson, former chief economist for the International Monetary Fund.

Read the whole story here.

Comments

[larry278]

Very much off thread: Mike Bloomberg continues to be a billionaire & he started a profitable news service. We may expect BHO to get him to work for him. Speaking of successful publishers, Arianna Huffington & Tina Brown could be working for BHO as the consequences of 9/15/08 get worse. W, Paulson, et al have no idea what hit them, the USA & the world. Bloomberg, Huffington & Brown know what hit us & why it hit us.

[Mikeeee]

He was only doing what he was hired to do, protect private funds with taxpayer money.

[PhilipTaylor]

Keith Olbermann said, "Why Daddy wen to Jail!"

Of course, this was phase 5 of the ripoff of America:

Stage 1 was the "TRICK&TRAP" mortgages buy the Investment Bankers' subsidiaries.
Stage 2 was creating Derivatives using sliced and diced High Risk mortgages adding massive Fees
Stage 3 was bribing with FEES the ratings agencies for "AAA" ratings, like T-Bills
Stage 4 was selling the Fake "AAA" paper to innocent Victims all over the world as low risk paper
Stage 5 was the Taxpayer as insurance policy if housing took a dive and Banks stuck with Fake Paper!

Paulson simply got down on his knees and begged Pelosi to not give up the Bailout and it finally went through. Then Paulson found a loophole in the 400 page bill that allowed him to let the banksters do anything they wanted to do with the $BILLIONS!

Of course, he did not match Buffett since these are his friends and he has NO CONCERN FOR THE TAXPAYER.

[kewps]

Paulson is nothing but a thief and a criminal. Same class as Bernie Made-Off.

[jinxed]

"Stiglitz said, “If Paulson was still an employee of Goldman Sachs and he’d done this deal, he would have been fired,”" but its good enough for the taxpayers. Brings new meaning to my bumper sticker which says "Democrats think the glass is half full, Republicans think the glass is theirs."

Why does this not surprise me? The taxpayer gets screwed and the banks and stockholders get protected and even make a profit after causing all this financial pain for the little guy! Taxpayers are going to lose big time, again, because of another Bush appointee. And where was Bernanke in all of this?

Paulson & Co. need to be brought up on charges of malfeasance, conflict of interest and intentional incompetence. Why do we continue to put people like this in positions of authority only to see them do this again and again and again? Didn't he take an oath or something when he took office?

[tyronegreen]

j

[Pete2069]

Why isn't Paulson in jail??? along with Bush , Rove , Cheney , Rumsfeld and the rest of these criminals..
Do you the way Bush's data mining crew are investigating the low lever democrats in the governor's office , and mayors office.

They have created a low level data mining investigation to discredit the democrats while they enjoy the results of their high lever criminal crimes in the past 8 years.. Can't belive Bush and these crooks are still walking the streets...

[Forest]

Divide anything this guy says by at least 760.

[totaldisbelief]

If we ripped Paulson's skin off would we find a reptilian alien in there?

[gorgol]

Your friends, Dr. Strangelove, want to thank you....the taxpayers want to hang you.

[Kassandra]

Well, it looks like Hanky won't get to play with the rest of the giveaway $$$:
http://www.google.com/hostednews/ap/article/ALeqM5guZZD6JB1VTosJf63ts4fBaRDSawD95JUG500

What a mess!

[jinxed]

Good g0d I hope not!

[SecretSister]

Somebody needs to tell Paulson that he is not working for Wall Street but is working for the American People. He needs to hold these banks feet to the fire and negotiate appropriately.

He seems to be accommodating Wall Street in such a way that you might think that he is going back to Wall Street to work when President-elect Obama comes into office.

[jinxed]

Lets make sure that Paulson doesn't have the opportunity to go back to Goldman Sachs or any other financial entity or enjoy the millions he got when he left Goldman's. He needs to go straight to jail, get tried then GO TO PRISON such as Leavenworth! Hopefully in the next 4 years he will have a lot of is colleagues join him along with most of Geo.43 & Co.s admin istra tion.

[OB-GYN]

I say let's insist they still follow that money! Nothing is irreversible.

[jerrypl]

Hank "the Paulie" Paulson is nothing but a mobster with a Ph.D. His chairmanship role at Goldman taught him the skills to work inside the Bush Crime Family Syndicate. He has orchestrated the Treasury to respond the the collapse of the world's biggest Ponzi Scheme, which began 30 years ago with Reagan. It finally came a blazin' under Bush, Paulson and Bernanke. It has been their full intention to rip-off American people in order enrich the corporate financial vampires so they will reign supreme after the economy falls further into the abyss.

http://eye-on-washington.blogspot.com

[whatsthisthen]

Ha. Did anyone expect more of Paulson? Did anyone really think that he would do anything but what is best for business? We do know that $250 billion in TARP funds went to banks, but we don't know what the banks did with the money. They could be buying other banks and investing overseas with TARP funds and nobody in government would know. Nice going, Hank. Makes me wonder if anyone in government, other than Barney Frank, has a conscience when it comes to spending THE PEOPLE'S MONEY. I know, I just made all the cynical people in government and business laugh...

[nevergiveup]

Best for business? You mean what's best for the RICH, overpaid Corporate Shills?

That's what he did. He sold us—and the US—out!

[whatsthisthen]

OK, big business. Sheesh.