Paulson Asks For More Money; GAO Criticizes TARP
Monday December 22, 2008
Secretary of the Treasury Henry Paulson has called on Congress to release a second $350 billion from the bailout fund dedicated to the financial system. However, earlier this month the GAO cast serious doubts on how well that money is being managed.
Even with the taxpayer infusion, the financial system seems on the verge of admission into intensive care. On Friday, Standard and Poor's downgraded its ratings on 11 financial institutions, including Citigroup (Citibank), Goldman Sachs, JP Morgan Chase and Wells Fargo. This despite the Federal Reserve setting the target rate at which banks loan one another money at the lowest level in history - zero to 0.25 percent.
A GAO report is critical of Treasury efforts, noting that Treasury does not have measures in place to ensure that the money is meeting its intended goals and nor does it have controls for monitoring compliance with limitations on executive compensation and dividend payments.
US taxpayers now own investments in 174 banks, without knowing the guidelines that were used to "waste their money," says bank analyst Richard Suttmeier.
See What Is The Troubled Asset Relief Program? and Purchases Under TARP - November 2008
Even with the taxpayer infusion, the financial system seems on the verge of admission into intensive care. On Friday, Standard and Poor's downgraded its ratings on 11 financial institutions, including Citigroup (Citibank), Goldman Sachs, JP Morgan Chase and Wells Fargo. This despite the Federal Reserve setting the target rate at which banks loan one another money at the lowest level in history - zero to 0.25 percent.
A GAO report is critical of Treasury efforts, noting that Treasury does not have measures in place to ensure that the money is meeting its intended goals and nor does it have controls for monitoring compliance with limitations on executive compensation and dividend payments.
US taxpayers now own investments in 174 banks, without knowing the guidelines that were used to "waste their money," says bank analyst Richard Suttmeier.
See What Is The Troubled Asset Relief Program? and Purchases Under TARP - November 2008