Remember the Wall Street Bailout? You know, that horrible travesty that cost taxpayers billions and rewarded Wall Street’s worst risk takers for plunging the American economy into the dump?
Well don’t look now, but the bailout may become one of the best investments taxpayers ever made.
In 2009 the Treasury Department paid $22.1 billion for troubled assets, mostly securities backed up by mortgages. Many of those mortgages were in danger of going into foreclosure, which made the securities risky and won them the name “troubled.” Nobel Prize-wining economist Joseph Stiglitz said the program was a “robbery of the American people.”
Well in this case, the robbers have done a pretty amazing job of paying the money back. The value of Treasury-backed securities has grown 27% in the last year and a half, according to a new study published by the Treasury Department.
But the investment is not yet a resounding success, some experts warned. The government has yet to be paid for about $9 billion of its debt, the report said, and increased foreclosure rates could endanger repayment.
Image: Douglas LeMoine, via Flickr.com