7 Facts You May Not Know About the TARP Capital Purchase Program

by David Ning · 8 comments

I was reading an article by Fortune magazine about the TARP funds and one fact caught my eye.  Did you know that the TARP application is only 2 pages?  I mean, is it 2 separate pages with fields on the front and page of each page?  Then I found the official TARP form, and all was clear.  It is 2 pages with 20 fields to fill out, half of which are things like company name, signatures and contact information.

This got me to research a little more and here are 7 interesting facts about the beloved TARP.

  1. Application for banks to receive tax payers money (TARP funds) is only 2 pages while we mail 30+ (at least) page packages each year to pay taxes.
  2. No banks provided specific answers to where the TARP money was spent when Associated Press asked 21 banks that got at least $1 billion in TARP money.  Some banks just say “I don’t know” (according to wikipedia)
  3. Ken Lewis (CEO of Bank of America) wanted to back out of the Merrill Lynch deal and was told by Bernanke and Paulson that BofA had to close the deal.  Those two even told Lewis that renegotiating a better price for BofA is not an option (according to Fortune magazine)
  4. NY Times is keeping tabs on who is getting TARP funds, while the government doesn’t have a list publicly.  (The government does sent out notices, but not when funds are committed.  They just let the public know in batches.)
  5. Before the Obama administration ever took office, $379.8 billion of the whole TARP fund has already been committed. (see NY Times link)
  6. I thought any funds over the first 350 billion was supposed to be voted and approved by congress before the treasury department can use it, but for some reason I never heard of news on that.  (I could’ve missed it, so could someone point me to mentions of it?)
  7. Last week, Eizabeth Waren of the Congressional Oversight Panel said that the government paid $254 billion for assets that were worth only $176 billion in 2008.  So much for making money on these things.

Maybe we should just sit back and relax because it’s not like we can do anything about it anyway.  I wonder if they can at least streamline the unemployment application because at least more people can benefit from that.  A 2-pager would be nice.

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{ read the comments below or add one }

  • Keith says:

    Well considering the home values were grossly overvalued when people bought back in late 2006 and into 2007, I can’t blame people for wanting a “hand-out” because ultimately it was the banks saying the properties were worth that when they weren’t. In a 6 month span back in ’06, my home value jumped $50K…completely ridiculous.

  • haha funny says:

    Well…considering that the US has a GDP of about $14 Trillion annnnnd that in the money market about $14 trillion is traded DAILY…how do you expect a bank to track exactly where $1 billion went? I’m sure it was immediately split up and moved to where it was needed. I don’t find that to be in any way odd. And as far as giving unemployment benefits vs. giving a bank money…do you have any idea how many people these banks employ? I’d rather keep people employed.

  • Greener Pastures says:

    Is there a TARP filing fee? Those shysters.

    When I think of all the red tape I have to go through for anything government related- including my taxes, passport, license, registration…and in the future, social security and medicare….

    grrrrrr

  • I am seriously considering purchasing the smallest bank possible and applying for TARP funds.
    If all PF bloggers unite and every one contributes $10k we would be able to buy a small bank, get TARP money and really blog for a living 🙂

  • Manshu says:

    Well, it may be just two pages, but the form is just a formality. TARP is set up to defend the financial stability of the US and when you think about Citi’s 2 trillion balance sheet, how many sheets do you think we’ll need to understand all of that?

    They should have certainly made the whole thing a thousand times more transparent, but I guess the number of pages for the form doesn’t really matter that much.

  • CD Rates says:

    Gov’t at its best. No accountability for $350BB to the people who created the mess, jail time if I fail to pay taxes on time.

    2 page form for them. 10 – 15 pages for my taxes. Thousands of pages of instructions.
    2 pages for them. 20 – 30 pages for a mortgage app.
    2 pages for them. 12 or so for Cell/Telephone service.

    Just whacky. cd :O)

  • Instead of applying for unemployment, maybe we should apply for TARP funds. Sounds like the process is easier and there aren’t as many hoops through which to jump.

  • Neal Frankle says:

    WOW…..this is amazing. I can’t say I’m surprised by the facts. I am shocked that it isn’t the number one story on talk radio and other bloggers’ sites. Thanks for bringing this up….(Now I have a good reason to be angry today.)

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