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Treasury Thinks Bailout Loss Will Be Smaller, AIG Whines About Pay
By
Jen Chung
Published Dec 7, 2009
Modified Dec 7, 2009
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By
Jen Chung
Published Dec 7, 2009
Modified Dec 7, 2009
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A Treasury report suggests that the government will, as the NY Times reports, "recover all but $42 billion of the $370 billion it has lent to ailing companies since the financial crisis began last year, with the portion lent to banks actually showing a slight profit." The Obama administration had estimated TARP-related losses of $341 billion.
The Times offers up more sort-of-good news/bad news: While "officials said the government could ultimately lose $100 billion more from the bailout program in new loans to banks, aid to troubled homeowners and credit to small businesses," it helps trim deficit forecasts from $1.5 trillion to $1.3 billion. Oh, and "The Federal Reserve...still holds a trillion-dollar portfolio of mortgage-backed securities whose market value is unknown," so who knows it that'll be good or bad for the country.
In other bailout-related news, the Wall Street Journal reports, "Five high-ranking executives at American International Group Inc. said last week they were prepared to quit if their compensation is cut significantly by the insurer's government overseers." (AIG's pay is being monitored by the government, since the firm received a bundle of bailout money.) While two of the executives changed their minds over the weekend, the WSJ adds, "AIG's recently hired chief executive, Robert Benmosche, threatened to quit last month amid frustrations over limitations on pay for top AIG executives. He argued that if the government wants AIG to prosper and pay back its debts, it needs to hire and keep top talent. He subsequently agreed to stay."
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AIG
bailout
deficit
tarp
treasury department
wall street
Jen Chung
Jen Chung is a former WNYC and Gothamist editor.
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