Home > Fande = Fact & Evidence, The Economy > Gretchen Morgenson, of The New York Times, bringing the Fande

Gretchen Morgenson, of The New York Times, bringing the Fande

source: http://www.nytimes.com/2011/08/28/business/economy/the-feds-rescue-missed-main-street.html?hp

EXCERPTS:

“If these rescues were intended to benefit everyday Americans, as Mr. Paulson contended, they have failed. Main Street is in a world of hurt, facing high unemployment, rampant foreclosures and ravaged retirement accounts….

As for making money on the deals? Only half-true, [Edward J. Kane, professor of finance at Boston College] said. ‘Thanks to the vastly subsidized terms these programs offered, most institutions were eventually able to repay the formal obligations they incurred.’ But taxpayers were inadequately compensated for the help they provided, he said. We should have received returns of 15 percent to 20 percent on our money, given the nature of these rescues.

Government officials rewarded imprudent institutions with stupefying amounts of free money. Even so, we are still in economically stormy seas. Doesn’t that indicate that it’s time to try a different tack?”

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