New Bank Bailout Could Cost $2 Trillion

WASHINGTON -- Government officials seeking to revamp the U.S. financial bailout have discussed spending another $1 trillion to $2 trillion to help restore banks to health, according to people familiar with the matter.

President Barack Obama's new administration is wrestling with how to stem the continuing loss of confidence in the financial system, as it divides up the remaining $350 billion from the $700 billion Troubled Asset Relief Program launched last fall. The potential size of rescue efforts being discussed suggests the administration may need to ask Congress for more funds. Some of the remaining $350 billion of TARP funds has already been earmarked for other efforts, including aid to auto makers and to homeowners facing foreclosure.

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Comments

[ScreenName05]

I am so tired of the ranting by people who have no clue about economics, finance, or how government works. First the republicans are wrong in their positions. The latest argument is that the stimulus package does nothing for small business - this from the CEO of Proctor and Gamble. The Republicans have always been 100% opposed to anything that helps small business. The best thing that can happen for small business is consumers with money to spend. If the stimulus goes thorough, it will put most of the money in the hands of middle class people who will spend the money. Second. The banks need help. They need regulations. The big banks need to be broken up. The small and regional banks need liquidity. If the banking system had not been allowed to merge into giant conglomerates we would not have the economic problems that currently exist. If we are going to fund the recovery of the banking system then we need to decide its purpose and regulate it to achieve that purpose. A lot of people need to go bankrupt, we need to change the bankruptcy laws back to where they were so that can happen. Otherwise this death spiral will never end. Yes some companies and some individuals will get hurt. They made the choices and took the risk. Its time to pay up.

[Janelle McCarley]

Anyone else out there upset about the notices from Citibank (for one) increasing interest rates??
This is just wrong on so many levels. We're just ordinary working people and haven't been as hard hit as some. Still managing to work and pay our living expenses, etc. We've used credit wisely, kept balances low, payments always on time. However, this month in our Sears and Home Depot bills there was a sweet letter stating that CitiBank (issuer of the cards) was having a difficult time in the "current economic enviroment" and therefor was raising interest rates on any balance and new business. Up to 24.99% from current 12.08%!!!!!

[informed01]

I have a belief the root cause for all this is from the toxic products the banks sold and risked and lost liquidity through the subprime debacle but a new phenomena is taking place from the first shock wave and it is home valuation drops that will cause the new failure to come. Owners cannot handle the cost or the thought of it, dropping consumer sentiment.

As a solution to the loss of home valuation issue for all homeowners that have seen plummeting valuations on their homes with home mortgages that were established in the last 5 years, a discount % on interest paid on the latter part of the loan to counter the loss of home valuation on the loan contract would be a fair relief and a boost to housing market and would not require any money to be exchaged or 1 trillion dollar stimulus plan to a black hole, just administration fees to write up the new contracts. Write your congressman about the source of the next financial failure.

[research]

A trillion dollar in investment in rooftop solar would eliminate all coal electric plants.

Another trillion Invested in America in efficiency solar and wind, could eliminate Nukes electric AND charge up plug in hybrids for every passenger car in the country.

Save over a trillion dollars per year.

Versus 2 trill wasted on the Bankers Derivative 1000 trillion dollar gambling loss fund.

Invalidate Derivatives and re regulate the banks before giving them another penny.

That's your big stick.

[drymartini1]

just turn on the printing press...geez...you really think the average person cares, if we print 2 trillion more ??

wait, american idol is on.

[davidwayneosedach]

Don't forget all the bonuses, office upgrades, jets, and new carpets. Better make it 3 trillion.

[funkalicious]

Why did we over pay for all the share KashKari bought? The Goldman Sachs way churn and burn, buy high sell low take the commissions.

We payed 100 dollars a share for Goldman non voting stock on a day it was selling to the public for 96
40 million extra today we are looking at 84 a share that's 160 million dollar loss..
And these idiots want us to buy more of the toxic mess ... what do they call that stuck on stupid.

[foresight]

THE PUBLIC SAY'S NO NO NO NO TIM . It's not a good time to provoke the laid off people of America and their growing ranks. Your buddies the Banks are loosers and the average man does not need them anymore.
Credit scoreas are about to become meaningless. They need to file BANKRUPTCY. No pain no gain.
This is the old FEUDAL SYSTEM rearing it's ugly head to steal all your assets in what used to be a subtle manner. The name of the federal reserve system needs to be changed to the FEUDAL RESERVE SYSTEM (The biggest Ponzi scheme ever orchestrated).

T A R P
A N A E
X D I O
L P
R L
O E
A
D

[WeTellTheTruth]

Barak Obama's economic team

Rahm Emanuel - Wall Street insider [ worked on wall street 2 1/2 years made $18 million]
Lawrence Summers - Wall Street insider
Timothy Gienther - Wall Street insider [cant even pay his own taxes]
Mary Shapiro - Wall Street insider
Robert Rubin - Wall Street insider [close Obama advisor, made $115 million on wall street]
Steve Rattner - Wall Street insider [named car czar, raised $100,000 for Obama campaign]

This should tell you everything.

[bbrecht]

Okay, so what do we do about this? Enough is enough. How dare they hand our money to criminals and not even touch the regulatory system that so obviously failed?

[ThoughtAboutIt]

I hate to say it but if Obama goes along with this nonsense I have to believe that every American President is the subject of blackmail and only those who have something to hide are allowed to ascend to the Presidency.

Why have the Democrats not mentioned electronic voting machines in quite some time?

[MsCanadian]

The government needs to let the banks fail and start over. They do not need to give them more money.

From what I read, the government is trying to appease too many people (e.g., CEO's, shareholders, depositors) and that won't work.

Personally, I would get all my money out of the bank and keep it at home!

More bailouts are not going to work, and I think the government is irresponsible in handing them more money. It will be endless.

[Mnemanth]

No accountability for what they've already greedily received. Reports of huge bonus pay outs. No lending. No address of the mortgage crisis. No fixes.
Why, why, why would it even be suggested that they received another stimulus?
"This is getting ridiculous"? It's been ridiculous from the start. Conveniently timed, conveniently legislated, and conveniently "believed" (spun) by our representatives to be helping you and I, the American people.
It's all ok. Either we can shake off the apathy- or we can continue to sit and watch this country fall apart. Until the people do something- DO SOMETHING- the democrats and republicans alike will continue to smile down upon us as they stuff their bottomless pockets.

[onalimb]

Do not give them 1 red cent.
We still do not know what they did with the last 350B other than give themselves bonuses.
As a member of the Bank of US I say give it to the people for a change.

[escrow7]

stop giving these banks money. Any personal finance person will tell you pay down debt, stop using credit cards etc. Credit is what got us into this mess and it is not going to get us out. There is lots of cold hard cash out there, but the so called investors are keeping it to themselves. Why invest in a bank when the government is giving away capital loans. make these banks raise there own captial.

they got themselves into this crap. Let them work there way out. They are going to help the average american out so why are we helping them.

http://www.thirdeyechronicles.com

[Freenation]

This is getting out of control

[Sundialsvc4]

Really, now. What is "pathetically obvious" is also "obviously pathetic."

Do I need to spell it out? Okay: you do not have two trillion dollars. You do not even have a hundred million. Or ten.

The Federal Government of the United States does =not= have the ability to print money out of thin air, to the tune of more than $1 million every single minute, as it presently DOES.

What happened immediately after the word "bailout" was first uttered? Well, no one should have really been surprised. EVERYONE has his hand out. And just for good measure, everyone is dumping jobs by the tens-of-thousands or threatening to do so. Houses are being converted into empty, worthless shells and middle-class families are joining the ranks of the homeless(!).

The "Bush-villes" are already there ... just never yet on tee-vee ... and plenty of folks would happily call them "Obama-villes" while cashing their customary "executive" (or Congressional) "compensation." Ol' Eb Scrooge was a whole lot more real than we often care to think.

What DOES the guv'mint have? It has authority. The exclusive ability to enact Law. And, if only it will do so(!), to enforce it.

[nikky]

SOMETHING TELLS ME THEY ARE HOARDING THE MONEY I SAY LET SOME OF THEM FAIL THIS IS GETTING REDICULOUS