The big banks claim that they have paid back all of the bailout money they received, and that the taxpayers have actually made money on the bailouts.
However, as Barry Ritholtz notes:
Pro Publica has been maintaining a list of bailout recipients, updating the amount lent versus what was repaid.
So far, 938 Recipients have had $607,822,512,238 dollars committed to them, with $553,918,968,267 disbursed. Of that $554b disbursed, less than half — $220,782,546,084 — has been returned.
Whenever you hear pronunciations of how much money the TARP is making, check back and look at this list. It shows the TARP is deeply underwater.
Moreover, as I pointed out in May, the big banks have received enormous windfall profits from guaranteed spreads on interest rates:
Bloomberg notes:
“The trading profits of the Street is just another way of measuring the subsidy the Fed is giving to the banks,” said Christopher Whalen, managing director of Torrance, California-based Institutional Risk Analytics. “It’s a transfer from savers to banks.”The trading results, which helped the banks report higher quarterly profit than analysts estimated even as unemployment stagnated at a 27-year high, came with a big assist from the Federal Reserve. The U.S. central bank helped lenders by holding short-term borrowing costs near zero, giving them a chance to profit by carrying even 10-year government notes that yielded an average of 3.70 percent last quarter.
The gap between short-term interest rates, such as what banks may pay to borrow in interbank markets or on savings accounts, and longer-term rates, known as the yield curve, has been at record levels. The difference between yields on 2- and 10-year Treasuries yesterday touched 2.71 percentage points, near the all-time high of 2.94 percentage points set Feb. 18.
http://www.washingtonsblog.com/2010/12/no-big-banks-have-not-really-paid-back.html
WikiLeaks founder Julian Assange has circulated across the internet an encrypted “poison pill” cache of uncensored documents suspected to include files on BP and Guantanamo Bay.
One of the files identified this weekend by The (London) Sunday Times — called the “insurance” file -- has been downloaded from the WikiLeaks website by tens of thousands of supporters, from America to Australia.
Assange warns that any government that tries to curtail his activities risks triggering a new deluge of state and commercial secrets.
The military papers on Guantanamo Bay, yet to be published, believed to have been supplied by Bradley Manning, who was arrested in May. Other documents that Assange is confirmed to possess include an aerial video of a US airstrike in Afghanistan that killed civilians, BP files and Bank of America documents.
One of the key files available for download -- named insurance.aes256 -- appears to be encrypted with a 256-digit key. Experts said last week it was virtually unbreakable.
Assange has warned he can divulge the classified documents in the insurance file and similar backups if he is detained or the WikiLeaks website is permanently removed from the internet. He has suggested the contents are unredacted, posing a possible security risk for coalition partners around the world.
Assange warned: “We have over a long period of time distributed encrypted backups of material we have yet to release. All we have to do is release the password to that material, and it is instantly available.”
The “doomsday files” are part of a contingency plan drawn up by Assange and his supporters as they face a legal threat. He is wanted in Sweden over sexual assault allegations, and the US is reviewing the possibility of legal action after the release of 250,000 diplomatic cables.
Ben Laurie, a London-based computer security expert who has advised WikiLeaks, said: “Julian’s a smart guy and this is an interesting tactic. He will hope it deters anyone from acting against him.”
Nigel Smart, professor of cryptology at Bristol University, said even powerful military computers would be unable to crack the encryption. He said: “This isn’t something that can be broken with a modern computer. You need the key to open it.”
The file is 1.4 gigabytes in size, which would be big enough for a compressed version of all the files released this year and additional data.
