Looks like the bailout is working out quite nicely

news.bbc.co.uk/2/hi/business/8593343.stm

[quote]The US government is preparing to sell its 27% stake in Citigroup, in what would be one of the largest share sales in history.

Some 7.7 billion shares in the bailed-out bank will be sold in tranches throughout 2010, the US Treasury said.

It will mark another stage in Wall Street’s recovery, and could make the US taxpayer $8bn (£5.3bn) in profit. [/quote]

[quote]The bank has received a total of $45bn in bail-out money from the Treasury’s $700bn Troubled Asset Relief Program (Tarp). It was the largest amount given to a bank (and was equal to the sum given to Bank of America).

Citigroup was given $25bn in return for 7.7 billion in shares, and was loaned another $20bn in two tranches. This $20bn was repaid in December. [/quote]

[quote]According to the latest official report on the state of Tarp at the end of 2009, 67 recipients had repaid all or part of their bail-out money, totalling more than $165.2bn.

The Treasury had also received by the end of December $16.9bn in additional payments such as interest and dividends on its investments. [/quote]

hmm, be interesting to read the naysayers spin these facts.

Additionally, there was a report in Bloomberg yesterday that estimated that the job growth for March will be in the neighborhood of 190,000 new jobs, the best in years.

market-ticker.org/archives/2 … me-Go.html

Also markets are at an inflated p/e right now. We aren’t at a proper p/e for a recession, never have been. Even at the 2008 bottom. Also the assumption is that the stock will be sold at above $3.15 per share, even with 7.7 billion shares dumped into it. Who wants it? Especially at that price?

IIRC TARP has already made significant return on it’s investments and that if Citi is successfully sold, that is one of the last remaining major liabilities.

Still sucks when several million jobs have been lost. However, it is better than the alternative.

[quote=“Elegua”]IIRC TARP has already made significant return on it’s investments and that if Citi is successfully sold, that is one of the last remaining major liabilities.

Still sucks when several million jobs have been lost. However, it is better than the alternative.[/quote]
Point is, there are now more than just a few signs that things are turning around.

My understanding is that there is still a long, slow road ahead. It’s nice to hear some good news though. Even in Taiwan, things are looking up. Formosa Plastics was in the black for the first time in a while. Demand for computers is going up.

And then there’s bad things lurking. Like housing bubbles.

Ya know, I wonder about this myself. To the casual observer, you see massive construction of residential buildings all over the place at a time when according to all sources, the population is declining. People keep buying homes, either as primary residences or investments, driving prices up, but how does that make sense at a time of declining population. Who’s gonna buy all these places? Seems like an obvious housing bubble to me.

So much of Taiwan’s housing stock is old, substandard and needs to be demolished. A large percentage of the population can now afford to upgrade to new, much higher quality housing, and that’s who the construction companies are catering to with these new projects. I would say that the figure for the number of empty housing units in Taiwan (well over a million the last time I saw it) is somewhat misleading in that so many of them are barely fit for habitation and are unlikely ever to be lived in again.

So much of Taiwan’s housing stock is old, substandard and needs to be demolished. A large percentage of the population can now afford to upgrade to new, much higher quality housing, and that’s who the construction companies are catering to with these new projects. I would say that the figure for the number of empty housing units in Taiwan (well over a million the last time I saw it) is somewhat misleading in that so many of them are barely fit for habitation and are unlikely ever to be lived in again.[/quote]

I agree, and posted on a similar proposal for Detroit. That plan seems to be progressing.

[quote=“CraigTPE”]Additionally, there was a report in Bloomberg yesterday that estimated that the job growth for March will be in the neighborhood of 190,000 new jobs, the best in years.[/quote]That’s because of all the temporary workers hired for the Census for 2-3 months. They will go right back to the unemployment line once the census is over.

So much of Taiwan’s housing stock is old, substandard and needs to be demolished. A large percentage of the population can now afford to upgrade to new, much higher quality housing, and that’s who the construction companies are catering to with these new projects. I would say that the figure for the number of empty housing units in Taiwan (well over a million the last time I saw it) is somewhat misleading in that so many of them are barely fit for habitation and are unlikely ever to be lived in again.[/quote]
This is really veering off topic, and perhaps the mods can split the thread, but there is still something I don’t understand.

Certainly there are a lot of substandard, dilapidated housing and maybe the people living there have the economic means to move up. The only way they get any money out of their old place is to sell to a developer who will flatten the building and build a taller one so he/she can get his/her ROI. The net result is still an increase in the number of units.

There will be no recovery in America for at least a decade. The government’s plan to re-inflate an asset bubble cannot work. Right now it looks like it’s just government sponsored looting by the banks, perhaps leaving the country for dead. The latest bill that plans to help homeowners is simply just free money for banks.

Yup. Which makes those inflated PE ratios even more inflated. 3-5yrs, but some things will never go back.

Here’s an article supporting the free money for the banks thing.

yubanet.com/opinions/Dean-Baker- … iative.php

Basically tricking consumers to pay up on their bubble priced house at the expense of government money while benefiting banks. This is basically tricking people into debt slavery. It’ll get worse as the federal reserve will have to raise interest rates, federal government increase taxes (or cut a massive amount of spending, which a large percentage of the economy is dependent on), and local governments either cut spending or raise taxes. It’ll be a miserable existence for many Americans.

I wonder how many years it will take for American to absorb the leveraged debt of the banks even with these government bailouts.

So, the Obama administration made some money for the government. That’s cool, but I’d rather not see the US government investing in individual companies, especially those in dire need of regulation. Why not invest in MO? The dividend is great and the long tern prospects good.

AFAIK, banks have done very little to change the practices that essentially caused the financial meltdown, and are actually right back doing what they were doing before the crash.

[quote=“hardball”]So, the Obama administration made some money for the government. That’s cool, but I’d rather not see the US government investing in individual companies, especially those in dire need of regulation. Why not invest in MO? The dividend is great and the long tern prospects good.

AFAIK, banks have done very little to change the practices that essentially caused the financial meltdown, and are actually right back doing what they were doing before the crash.[/quote]
Was it the Obama administration or was it the Bush administration?

[quote=“Dr. McCoy”][quote=“hardball”]So, the Obama administration made some money for the government. That’s cool, but I’d rather not see the US government investing in individual companies, especially those in dire need of regulation. Why not invest in MO? The dividend is great and the long tern prospects good.

AFAIK, banks have done very little to change the practices that essentially caused the financial meltdown, and are actually right back doing what they were doing before the crash.[/quote]
Was it the Obama administration or was it the Bush administration?[/quote]
I don’t think the Bush administration made ANY money for the government. :laughing:

(Oh, I see what you mean. Well, here’s an article from 2008…so looks like Bush initiated it…and look at the deal…[quote]
In return for the latest intervention, the government will receive a larger stake an additional batch of preferred shares - $20 billion for its direct investment and $7 billion as compensation for the loan guarantees. Citigroup will pay an 8% dividend rate on those shares. <<the yield now for C is “Div & Yield: N/A (N/A)”>>

In addition, the government will get warrants, or the right to purchase $2.7 billion worth Citigroup shares in the future.

The government will impose restrictions as well. Citigroup will be prohibited from paying out a dividend of more than a penny per share for the next three years and will face limits on executive compensation.[/quote]…hardcore deal for sure. But Obama sold it…so he gets the Win. )

Here’s a good book that explains some of it:
amazon.com/Big-Short-Inside- … 0393072231 *

  • same guy who wrote moneyball actually. :wink:

[quote]
Citigroup, which has posted more than $100bn in write-downs, required three government rescues in 2008 and 2009.

At Citigroup’s opening share price of $4.39 on Monday, the Treasury’s stake would be worth just over $33bn, giving an $8bn profit to the US taxpayer.

The bank has received a total of $45bn in bail-out money from the Treasury’s $700bn Troubled Asset Relief Program (Tarp). It was the largest amount given to a bank (and was equal to the sum given to Bank of America).

Citigroup was given $25bn in return for 7.7 billion in shares, and was loaned another $20bn in two tranches. This $20bn was repaid in December. [/quote]
From the OP’s post.

This is like a fantasy sports league thread…:roflmao:

(I guess I should just post this right to ‘temp’ as I’m stepping on an untouchable subject)

[quote=“hardball”]So, the Obama administration made some money for the government. That’s cool, but I’d rather not see the US government investing in individual companies, especially those in dire need of regulation. Why not invest in MO? The dividend is great and the long tern prospects good.

AFAIK, banks have done very little to change the practices that essentially caused the financial meltdown, and are actually right back doing what they were doing before the crash.[/quote]

Well, yes, that’s a nice though. But what about the bank collapse? More and mroe evidence is showing that letting Lehman go the way they did was a mistake, rather than an orderly unwind.

So while I’d rather they not have to bail out the banks, I’d rather see the banks bailed out than face the alternative.

So far I’ve not seen any reform coming from our Republic friends. If TARP was Socialism, what would the Republican’s call a sensible proposal like having the banks pay a fee to fund a bail out reserve as they did in Sweden?

Eh? The Treasure earns money all the time on everyhting from bailing out Mexico to minting currency.

BTW: Who gutted the SEC by appointing idiots like Harvey Pitt?