U.S. Will Let Some Banks Repay Aid: Chase, Goldman, Amex Expect To Be On List

Washington Post:

The Obama administration plans to announce as soon as today that some of the nation's largest banks can repay billions in federal aid, but some officials caution that the show of progress is being underwritten by multiple layers of less visible government support.

Read the whole story: Washington Post

Comments

[platanoman]

If they want to pay, then let them pay. Someone mention leverage. You have to remember some of this banks became commercial banks and are now subjected to tougher leverage restrictions.

[Sharon908]

TARP money being allowed to be repaid by Zombie banks...what a joke..ZOMBIE BANKS ARE ALREADY DEAD!!!!

"BING" the word MORATORIUM. The OPTION ARM loans with NEGATIVE AMORTIZATION that has brought down a significant portion of Wall Street firms thus far, had it's can kicked down the road by the Government imposed MORATORIUM of WACHOVIA/WELLS FARGO and more Lenders who offered this garbage, and have the majority of these loans in their portfolios. With over a trillion dollars plus worth of OPTION ARM loans resetting now and in the future (2010,2012) how much CAPITAL do you think the Banks REALLY need to raise to stay afloat as these loans come out of moratoria?

We the people do have POWER and should begin using it by JUST SAYING NO. LET ALL THOSE WHO THE GOVERNMENT CONSIDER AS TOO BIG TO FAIL......­FAIL..afte­r all, they are already dead.

[Rich Hosking]

These banks are not- cannot be solvent. The core problem is that they are leveraged at 30:1 using mortgage backed securities--US mortgages!! The housing crisis has only gotten markedly worse this year. Every dollar lost (and the average home has lost 10s of thousands!) is magnified 30+ times for the banks.
Yet, mirculously, they are solvent! The government was cutting into the whole point of the game--scandalous salaries and operating practices.

Get ready for the next crash and cash give away, because NOTHING has been truly solved, only ignored, hidden, or spun.

When the US government (taxpayers) absorb another 2-4 trillion of losses, then it will be over. Until someone on Wall Street or in Washington decides to tell the truth, we'll play this game. A show for investors and the Chinese government....

[RightWingMarine]

some banks are going to be permitted to repay the loans the didn't want in the first place. How gracious. But here's the rub, "As with mortgage giants Fannie Mae and Freddie Mac, the government will no longer share in the banks' profits, but it still stands ready to absorb losses." Why are we doing this?

[conservapitalism]

campaign payback

[sonofsamphm1c]

To say they did not want TRAP is untrue. They wanted TARP for the big institutions that were going to fail; they just wanted to be able to say they didn't need a loan themselves.

Paulson correctly reasoned that taxpayer dollars would be best protected if all of the biggest banks took money.

That did not change their minds about TARP being absolutely necessary as there was a distinct possibility that drowning institution could drag big banks that did not need a TARP loan down with them, so they gladly took the money.

[sonofsamphm1c]

Nonsense.

[sonofsamphm1c]

Nonsense to campaign payback.

[bayside]

What is wrong with this picture Some banks will be allowed to repay tarp ..This should have been a mandate that they would repay taxpayers back ..Auto makers had to sign a loan and be required to pay us back..Why are wall street and bank s given and given our hard earned money but not be required to pay us back..

[sonofsamphm1c]

It was a mandate. They had up to 5 years to repay their TARP loan.

[Portnoy]

Make them pay extra for their crimes

[Pippen]

When banks get too big to fail and commit heinous acts of corruption and greed and failed monetary decisions that weaken the security of the United States we get a wierd scenario where the people and the government scream for punishment.

It sounds alot like this : ".....look mom I punished my left leg for not finishing the race at school by beating it with a machete...."

NEVER LET A BANK OR BANKS GET TOO BIG TO FAIL. That's the moral of the story.

[talkitreal]

The banks are repaying the bailout funds they received! Good Stuff!

[sonofsamphm1c]

The only downside - thanks to the likes of John Thune, Brad Sherman, the Republican neocons in Congress and their fellow travelers at The Huffington Post - is the taxpayer is going to lose out on tens of billions in interest income and capital gains.

[conservapitalism]

Buy your own stocks in the banks you like..Dont let Obama invest for you

[Portnoy]

The other downside is lack of control over CEO pay. By paying back the money, the Administration will have to back off being able to limit the CEOS pay and bonuses.

Not Good.

Congress need to inact some sort of CEO pay limit across the board for financial institutions.

[platanoman]

The taxpayer is going to get their money and interest. Let's not forget the warrants. I think I am satisfied with that

[KillTheMessenger]

So why did you all use those credit cards if you didn't understand the terms? I mean... it's not like they aren't printed in black and white.

[gbrooks]

I'm feeling pretty cynical at the moment, so I ask you--what money?

Did anyone come and take your valued possessions? Did your bank account have a charge to it that stated "TARP--courtesy of GW Bush (and now BH Obama)?

Nope. All of this is just fiat money bullshittery. People like us don't get our money back, we don't get a currency that actually has any value, this is all a shell game. Money is now just a blip on a computer screen, the only reason a billionaire might have more "value" than a homeless person is because he has more assets that he can sell.

This artificial propping up of the dollar is just to give a few more people who know what's going on time to prepare for the transition to whatever comes next. A currency without actual assets backing it is, of course, doomed to fail.

[KillTheMessenger]

If you don't like your "worthless fiat money", please send it to me. I know just what to do with it.

:-)

[gbrooks]

If/when the dollar collapses, I'll be more than happy to. And I'm sure that when you say you "know just what to do with it" you likely mean that you'll use it to purchase viable assets.

Think about this: Just this weekend, I bought a grill off of (the evil) Craigslist for $30--very high quality, barely used. I gave this guy two pieces of paper (a $20 and a $10), which are almost worthless in the real world, for something that I can actually use to process food. I'm sure I got the better deal, as these grills last for over 20 years if you take care of them. A piece of paper lasts seconds (if you've primed the grill correctly.)

Wish you'd said something of more substance, I'd like to be proven wrong/right or neutral. This system just seems logically unsustainable and far too easy to manipulate.

It's just odd to me how few people can see this.

[jerrypl]

Here is the scam. If the zombie banks are now able to pay back the TARP funds, then they must NOT be insolvent anymore; therefore, they do not need another penny of financial assistance from the government. They don't need the PPIP, or TALF, or zero percent Fed Fund window loans from Bernanke. Then cut them loose completely Mr. President, otherwise they are all still lying to the American people.

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

[sonofsamphm1c]

That is a scam?

There was no scam. There has been no heist. A whole bunch of total crap has been written about the credit crisis with suggestions and demands that would have destroyed the financial system.

The Obama administration turned a deaf ear to the lunacy and they should continue to do so. It should be apparent to any thinking person that they had this thing pretty well figured out long before the Nobel Prize winners hit their snooze buttons on the morning of January 20th.

So I think President Obama should continue doing the smart thing - what he has been doing to date.

[mamacat]

Sounds good to me.

[Kungfublood]

How about something like this:
Dear banks:
We the people of the United States having reviewed your credit we found your credit to be too short a period of time and to close to the credit limit on to many loans so we are retroactively raising the loan to %20 compounded hourly and hereby demand full payment within 30 days or your credit will be frozen* and sent to collection. Interest will of course continue to accrue.
Have a nice day.

[KillTheMessenger]

Sounds good... except that the banks didn't sign the kind of contract that you did when you got your credit card. They are just not that stupid...

[PhilipTaylor]

Would these agents of s1eaze forgive a home owners prepayment penalty? NO!

We should NOT forgive their Penalties for early payment! It is only FAIR!

[bluejay20255]

Where is the prepayment penalty in the UST term sheet?

[KillTheMessenger]

I paid my home loans off years early. Didn't pay a single cent for that. I don't know what kinds of loans you got, but mine were just fine. Thanks for playing, though.

[Drdemocrat]

Give us back our money!!!!

[talkitreal]

That is what they are doing!