Neil Barofsky, former Special Inspector General in charge of oversight of TARP, has written a juicy new book about the bailout and how it was handled–mishandled, rather, which is where the juicy parts come in.
We got an advance copy of Bailout: An Inside Account of How Washington Abandoned Main Street While Rescuing Wall Street, hitting shelves July 24. So what have we learned about the little (not little) bailout that could (or couldn't)?
Neil Barofsky is kind of a dick. Barofsky's former boss, U.S. Attorney Mike Garcia, had this to say about his employee's appointment as SIGTARP: "You can be kind of a dick sometimes, and they needed someone who could be kind of a dick."
Tim Geithner is a dick. Here is a partial list of words and phrases Barofsky uses to describe Tim Geithner and/or Tim Geithner's actions: "brusque," "bizarre," "sweaty," "twitchy," "utterly dismissive." Alas, the world may never know how Neil Barofsky really feels about Tim Geithner.
Tags: Banks, Books, Chuck Grassley, Economy, Elizabeth Warren, Indecision Book Club, Neil Barofsky, Obama Administration, TARP, Timothy Geithner
If you want to be something really scary this Halloween, why not dress as Neil Barofsky*, inspector general of the Troubled Asset Relief Program? Neil's job involves emerging from his cave every few months, torturing the country with his terrifying numbers, and then slinking back into the darkness. Nobody knows what he eats to stay alive, or if he eats at all.
It's that time of year again, and Mr. Barofsky's latest report to Congress is spine-tingling per usual…
[Barofsky's report said that] "although several TARP recipients have repaid funds for what has widely been reported as a 17 percent profit, it is extremely unlikely that the taxpayers will see a full return on their TARP investments."
His report said some 50 billion dollars used to help avoid foreclosures "will yield no direct return." As for the investments in insurance giant AIG and auto giants General Motors and Chrysler, "full recovery is far from certain."
"The firms that were 'too big to fail' last October are in many cases bigger still," it added.
The report also says that the public no longer trusts the government to do things with money. That's not news, of course, but Neil Barofsky does not have cable in his lair.
*The ladies' version of this costume would be "sexy Neil Barofsky."
Tags: Economy, Neil Barofsky, TARP
The concerned-looking fellow over there is Neil Barofksy, who holds the thankless post of TARP Inspector General, which means he lives in fear of Timothy Geither, who will probably have him waterboarded for saying things like "Yeah, nobody at Treasury even knows where the banks put all that money we gave them."
Because Neil Barofsky's life is so stressful we can forgive him for wanting everyone else in the country to get a taste of the terror he feels, which is why Neil Barofsky just slammed us with the scariest thing he could think of: $23.7 trillion, as in the "total potential" cost of bailing out the financial system.
$23.7 trillion! $23.7 trillion! $23.7 trillion! Aaahhhh! Type it five times and Ben Bernanke appears!
[Barofksy's terrifying number] includes estimates of the maximum cost of programs that have already been canceled or that never got under way.
It also assumes that every home mortgage backed by Fannie Mae or Freddie Mac goes into default, and all the homes turn out to be worthless. It assumes that every bank in America fails, with not a single asset worth even a penny. And it assumes that all of the assets held by money market mutual funds, including Treasury bills, turn out to be worthless.
It would also require the Treasury itself to default on securities purchased by the Federal Reserve System.
Oh no! Those are all things that could totally, realistically happen!
The sheer unreality of the number did not stop some members of Congress from taking the estimate seriously.
I'm going to sleep so much better tonight, now that I know our elected officials are keeping us safe from imaginary numbers.
Tags: Banks, Economy, Neil Barofsky, TARP