Profits to the government from the bailout

"Two years later TARP’s bank and insurance investments have made money, and about two-thirds of the funds have been paid back."

Only Crabby would believe that getting two-thirds of your investment back is a profit.

Hey, Crabby, ever hear the one about counting your chickens? :smilewinkgrin:

 

What "probably will happen" is not a profit until it happens.

 

http://www.nytimes.com/2010/10/26/business/26tarp.html

"The United States Treasury concealed $40 billion in likely taxpayer losses on the bailout of the American International Group earlier this month, when it abandoned its usual method for valuing investments, according to a report by the special inspector general for the Troubled Asset Relief Program. "

So in reality - Crabby's future profits from the bailout are the result of changes in the valuation of investments.

IOW - the government is again cooking the books.


"The Treasury will include more information about A.I.G. when it issues its own audited financial statement in November. Because those numbers must pass an auditor’s scrutiny, the loss it reports is likely to grow once again, to more than $5 billion."

Even after cooking the books the Treasury is still predicting a loss - not a profit.

"The Treasury declined. It sent back a letter saying its methodology for calculating losses had not really changed, although its assumptions had. For instance, it based the values of several future transactions on the current price of A.I.G.’s common stock."

And even then it is based on counting their chickens before they hatch.

 

So Crabby, wouldn't the best thing be for government to take over all business?

After all, they know best.

 

And you actually believe that the goverment could have prevented this from happening? I feel sorry for you. I really do.

 

Did 1930's Germany teach you that as well?

 

You forgot to include original investment. If I originally invested at, say, $100, while the stocks were at $1 per share; and now I sell back 2/3 of those shares at $1.25, it looks like I'm making .25 profit on each of those shares...but I've only received a return of $82.50 on my original investment of $100. That's still known as a "loss."

 

Everyone here knows what a profit is - except for you.

Send me $100.

I'll pay you back $30 and an IOU for $90.

You can tell everyone that you made a big profit.

But good luck getting the rest of your money.

 

CTB - you've made a profit only on individual shares. If you try to run your business on that principle, you'll go bankrupt really, really fast.

Oh, wait -- what was our country's debt amount again?

 

My bad, I forgot about your critical thinking skills disabilities.

I was referring to the fact that fascism has time and again been demonstrated to be a terrible system upon which to build a society.

 

Nice example of a "paper profit."