The bailouts the government made numerous years back, to keep some huge financial firms open and to prevent further fiscal mayhem, may have not been as bad a concept as many believed. One of the biggest bailouts was the AIG bailout, which came to almost $200 billion being lent to the establishment by the taxpayers. So far, the federal government has actually made a profit on AIG, about $18 billion worth. How often have you wanted additional information on how to apply for a payday loan and resorted to an online search on payday loans instant approval?" Look no further, all of the information and facts you need is at MatchFinancial.com.
Great news for AIG bailout
The Temporary Asset Relief Program allowed the federal government to purchase stakes in businesses it was giving cash advances to. The financial industry is not doing that bad anymore, and the American government is reaping rewards. The AIG bailout amounted to $182 billion, including $90 billion alone from the New York federal Reserve, according to the Wall Street Journal. It was also a very political bailout. However, was quite the investment, as a huge chunk of the stake in AIG was just sold, resulting in $17.7 billion of profits made from AIG so far.
Not all gone
The last things gained with the TARP program were sold off by the federal government. The specific assets were part of the “Maiden Lane III” portfolio that was received with the AIG bailout. Maiden Lane III incorporated a number of securities, including, according to Fox Business, the subprime mortgages that were a huge part of the housing and financial meltdown of several years back. In total, that portfolio made a $6.6 billion in profits for the federal government and “The Fed,” according to the Wall Street Journal. The government still holds a 53 percent ownership stake in the company, because of the shares in common stock that were acquired in the bailout, or roughly $24.2 billion. Those 871 million shares, according to ABC, could go for $30 billion depending on conditions.
All bailouts not worthwhile
Despite the political unpopularity, the federal government has, in the AIG bailout and in the TARP program in general, proven itself to be quite the equity capital firm concerning investments in Wall Street firms and banks. In those programs, according to ABC, the government has seen a return of about $21 billion in profits from $245 billion in loans, just under a 10 percent return. However, other parts of TARP have not been successful. The Treasury Department anticipates a $25 billion loss when the shares acquired from Chrysler and General Motors get sold. The troubled mortgage refinance programs, which amounted to $46 billion in funding, are also thought to be a total loss. In total, it's estimated that TARP will result in a $63.5 billion loss.