Taxpayers are still owed $132.9 billion from companies like General Motors and the American International Group Inc. who benefited from the financial bailout. Christy Romero, the acting special inspector general for the $700 billion bailout said that some of that money may never be recovered.

Romero says that the bailout, which started in September of 2008, could last for several more years. Some bailout programs, like the effort to help homeowners avoid foreclosure, will last until 2017 and will cost the government at least another $50 billion.

According to the Huffington Post, the American International Group Inc. owes close to $50 billion. General Motors Co. owes $25 billion and Ally Financial Inc. about $12 billion.

Romero also reports that 371 banks still owe taxpayers money. Regions Financial Corp. and Zions Bancorporation both owe more than $1 billion. Synovus Financial Corp., Popular Inc., First Bancorp of San Juan, Puerto Rico, $M&T Bank Corp., all owe seven figure amounts.

USA Today reports that after the 2008 financial crisis Congress authorized $700 billion to lend out to companies in need. About $413 billion was lent out to financial companies and automakers. So far, 77%, or about $318 billion, has been paid back.

Treasury spokesman Matt Anderson said that it could take years for the Treasury to break even. The Huffington Post notes that the Treasury would have to sell its stock for GM at  $53.98 to break even. As of Wednesday, GM’s stock was at $24.92.

Anderson said:

“We’ll continue to balance the important goals of exiting our investments as soon as practicable and maximizing value for taxpayers.”

Romero’s report also uncovered fraud related to TARP. Criminal charges were brought against 10 people during the fourth quarter. Altogether, criminal charges have been brought against 61 people for fraud in relation to TARP.

$132.9 Billion Still Owed to Tax Payers From Bailout is a post from: The Inquisitr

Michele Bachmann’s new book hit stores today, and it’s not only Democrats who get a bashing. The LA Times reports how Bachmann is happy to attack fellow Republicans, with George Bush the biggest target in her GOP target practice.

Bush gets heat from the GOP presidential candidate for the fact he backed the $700 billion Wall Street bailout in 2008. Bachmann accuses the ex-President and former Republican candidate John McCain of abandoning conservative, free-market principles when they supported the Emergency Economic Stabilization Act of 2008. Ad she even manages to squeeze in the dirty ‘s’ word:

“The Bush administration … was embracing a kind of ‘bailout socialism. It was painful to find out John McCain too favored the TARP bailout. … Here was no ‘maverick’ moment. The same disappointing stance was taken by the Republican leadership in the House.”

How one equates a $700 million bailout of rich bankers with socialism is confusing me also, but I gave up trying to understand Bachmann many moons ago. She added:

“I knew there was no way I could vote for it, because I couldn’t find authority for it in the Constitution. As a constitutional conservative, I put principle over party.”

Michele Bachmann Lays Into George Bush Over Bailout is a post from: The Inquisitr

Considering the fact that the US, and the rest of the world, is still trying to recover from a recession one has to wonder why a company still under government governorship hands over $1.95 million as a signing bonus to its new CFO Ross J. Kari.

Along with that he also received the following perks

These were among the tidbits that the folks over at footnoted.org found when they when through his employment contract that they had come across. As they also pointed out none of this was ever included in Freddie Mac’s press release about the appointment.

Freddie Mac gave new CFO a $1.95 Million signing bonus is a post from: The Inquisitr

In what can almost be described as an “Economic Meltdown For Dummies,” Matt Taibbi’s article “The Great American Bubble Machine” in the latest issue of Rolling Stone is a great primer on the machinations behind the current financial crisis that reads like a good novel.

You may remember Taibbi’s recent, almost viral ranty response to AIG bigwig Jay DeSantis’ New York Times letter of resignation. Taibbi got internet-wide props for the scathing piece, which gave voice to the lack of sympathy and palpable rage felt by many Americans when reading DeSantis’ sob story. An excerpt:

DeSantis has a few major points. They include: 1) I had nothing to do with my boss Joe Cassano’s toxic credit default swaps portfolio, and only a handful of people in our unit did; 2) I didn’t even know anything about them; 3) I could have left AIG for a better job several times last year; 4) but I didn’t, staying out of a sense of duty to my poor, beleaguered firm, only to find out in the end that; 5) I would be betrayed by AIG senior management, who promised we would be rewarded for staying, but then went back on their word when they folded in highly cowardly fashion in the face of an angry and stupid populist mob.

I have a few responses to those points. They are 1) Bullshit; 2) bullshit; 3) bullshit, plus of course; 4) bullshit. Lastly, there is 5) Boo-F***ing-Hoo. You dog.

Taibbi is now making waves with “The Great American Bubble Machine,” crafting an argument that Goldman Sachs “has engineered every major market manipulation since the Great Depression” and that they’re already planning their next heist. Taibbi breaks it down into five major bubbles, five huge market manipulations preying on the American public, hedging wild bets against our futures and better interests.

According to Taibbi, here’s the scam template:

Goldman positions itself in the middle of a speculative bubble, selling investments they know are crap. Then they hoover up vast sums from the middle and lower floors of society with the aid of a crippled and corrupt state that allows it to rewrite the rules in exchange for the relative pennies the bank throws at political patronage. Finally, when it all goes bust, leaving millions of ordinary citizens broke and starving, they begin the entire process over again, riding in to rescue us all by lending us back our own money at interest, selling themselves as men above greed, just a bunch of really smart guys keeping the wheels greased.

And the heartwarming history behind Goldman’s first major con during the Great Depression:

Beginning a pattern that would repeat itself over and over again, Goldman got into the investment-trust game late, then jumped in with both feet and went hog-wild. The first effort was the Goldman Sachs Trading Corporation; the bank issued a million shares at $100 apiece, bought all those shares with its own money and then sold 90 percent of them to the hungry public at $104. The trading corporation then relentlessly bought shares in itself, bidding the price up further and further. Eventually it dumped part of its holdings and sponsored a new trust, the Shenandoah Corporation, issuing millions more in shares in that fund – which in turn sponsored yet another trust called the Blue Ridge Corporation. In this way, each investment trust served as a front for an endless investment pyramid: Goldman hiding behind Goldman hiding behind Goldman. Of the 7,250,000 initial shares of Blue Ridge, 6,250,000 were actually owned by Shenandoah – which, of course, was in large part owned by Goldman Trading.

Getting deja vu yet? The next round of looting, according to the piece, didn’t occur until the dot-com bubble of the late 90s. Wild speculation and IPOs of never-profitable net properties were small potatoes compared to what came next.

Bubbles #3 & #4 were the housing bubble and gas-price gouging . As Jon Stewart famously skewered at Jim Cramer, Goldman Sachs and their ilk hedged their bets against us again in banking on their own shady mortgages defaulting and cashing in on the fallout. Speculation on the oil market soon after lead to gas costing upwards of $4 a gallon in the summer of 2008, but most Americans were too busy freaking out about their impending homelessness to notice the connection.

Bubble #5 was looting the bailout, but according to Taibbi, the next bubble will be even bigger- energy futures and carbon credits, and “groundbreaking new commodities bubble, disguised as an ‘environmental plan,’ called cap-and-trade.” Taibbi caps it off with a kind of acceptance- the “great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money” will keep on sucking- but at least now we know about it.

Matt Taibbi on the Great American Bubble Machine is a post from: The Inquisitr

In light of the massive bailout for the automobile industry and the constantly shifting executives a rather interesting story has surfaced as to one of the reasons that GM is having such a hard time. While it is somewhat of an inside joke many people have wondered why it is that GM cars has such bad interiors compared to their competition. Sure some of the blame can be transferred right down the supply chain but it turns out it could be much more basic than that.

According to a well placed GM insider who contacted the crew at The Truth About Cars (TTAC) blog it all boils down to the executives. As it turns out the executives of GM have never known, and still don’t know that there is any real problem. Robert Farago at TTAC writes

As you probably know, ever since GM was founded, its execs have either been driven by a chauffeur or provided with carefully prepared and maintained examples of the company’s most expensive vehicles. Of course, there are times when the suits must sign off on the company’s more prosaic products. Since 1953, this intersection between high flyer and mass market occurred at GM’s Mesa, Arizona, Desert Proving Grounds (DPG). The execs would fly into Phoenix’s Sky Harbor airport, limo out to the DPG and drive the company’s latest models.

Our agent says that all the vehicles the execs drove were “ringers.” More specifically, the engineers would tweak the test vehicles to remove any hint of imperfection. “They use a rolling radius machine to choose the best tires, fix the headliner, tighten panel and interior gaps, remove shakes and rattles, repair bodywork—everything and anything.”

Did the execs know this? “Nope. And nobody was going to tell them . . . As far as they knew, the cars were exactly as they would be coming off the line. That’s why Bob Lutz thinks GM’s products are world-class. The ones he’s driven are.”

I asked Agent X if the GM execs would ever drive the cars again. Did he know if Wagoner or Lutz dropped in at a dealership to test drive a random sample off the lot? He found the idea amusing.

Robert also writes that their contact says that rather than the situation improving it is actually getting worse. Between selling off their major testing grounds in Arizona and some real problems at the replacement facility in Michoacán, Mexico the situation doesn’t look good.

But then of course we all get to see these new television ads proclaiming the new GM …. I wonder if that means the executives driving the real cars that are going to market or just some more specially prepared ringers.

GM: Making something better means knowing about the problem is a post from: The Inquisitr

Obama and other administration officials have said they would demand deeper restructuring from General Motors Corp. and Chrysler LLC before they would get any more government loans.

Both GM and Chrysler are living on a total of $17.4 billion in federal aid.

Source: MNBC.com

While one might question the While House making demands like this I’m glad that they are. The automotive industry can’t be expected to live off of the people’s money and still retain the same people who have been responsible for its current situation.

[picture courtesy of Critique Auto / hat tip to Brian Sullivan via FriendFeed]

GM boss told to step down by White House is a post from: The Inquisitr

The criticism from the right blaming autoworkers for the demise of the American auto industry hasn’t always been fair. It isn’t the fault of workers that the big three have produced products people don’t want; management fairly takes a big share of the blame. But then you read these stories you can see partially where the right was coming from.

Reuters reports:

Ford Motor Co expects operating savings of $500 million per year from an agreement with the United Auto Workers that will push hourly wage rates into the “ballpark” of foreign-based rivals, the company said on Wednesday.

The agreement trims average wages and benefits for UAW hourly workers to about $55 per hour this year, while the U.S. operations of foreign-based automakers — or what executives call “transplants” — pay workers on average $48 to $49 per hour, Ford said.

That’s right, $55 per hour. If they work a 36 hour week or longer, that’s $100,000 USD a year, and that’s the reduced pay.

Now I’m all for people getting paid what they deserve, and many of these assembly line jobs could involve a fair bit of technical knowledge. But in a market that in part has been killed by cheap Asian imports, and where many Americans struggle to find jobs, let alone get $10/ hour, workers at Ford have their pay cut to $55/ hour. And a non-American owned company pays workers in the United States $48-$49 per year.

Ford didn’t take a handout from the US Government, but presuming their pay rates are similar to workers at GM and Chrysler, you can safely say that this is part what the auto industry bailout is paying for. Your taxpayer money at work indeed

Ford and Unions negotiate a pay cut…to $55/ hour is a post from: The Inquisitr

Part of the fun of being a blogger who reads a lot of different blogs each and every day is that you get to watch events unfold that develop into a really good smackdown. Such was the case that started on Saturday with a post in the New York Times where Thomas Friedman offered up a Op-Ed called Start Up the Risk Takers. Friedman’s basic principal was that instead of handing over billions of dollars to perpetually failing companies the Government should cut a deal with the top 20 Venture Capital firms in America.

As he put it

G.M. has become a giant wealth- destruction machine — possibly the biggest in history — and it is time that it and Chrysler were put into bankruptcy so they can truly start over under new management with new labor agreements and new visions. When it comes to helping companies, precious public money should focus on start-ups, not bailouts.

You want to spend $20 billion of taxpayer money creating jobs? Fine. Call up the top 20 venture capital firms in America, which are short of cash today because their partners — university endowments and pension funds — are tapped out, and make them this offer: The U.S. Treasury will give you each up to $1 billion to fund the best venture capital ideas that have come your way. If they go bust, we all lose. If any of them turns out to be the next Microsoft or Intel, taxpayers will give you 20 percent of the investors’ upside and keep 80 percent for themselves.

This of course brought out the indomitable VC man himself – Fred Wilson who said pretty much .. thanks but no thanks to the idea. In fact the problem right now with venture capital as Fred sees it is that venture capital has too much capital (huh?)

I understand the point Tom is making – that we ought to be investing in the future instead of the past. And for that, I applaud him.

But the venture capital business, thankfully, does not need any more capital. It’s got too much money in it, not too little. Just ask the limited partners who have been overfunding the venture capital business for the past 15-20 years what they think. You don’t even need to ask them. They are taking money out of the sector because the returns have been weak.

And the top 20 firms in the venture capital business are the least in need of a bailout of any group I’ve ever thought about. These firms, the Sequoias and Benchmarks and Accels and Kleiner Perkins etc etc can raise a fund anytime they want. Accel raised a ton of money last fall in the midst of the worst global financial meltdown in my lifetime.

Now this probably would have been a great end point point to the discussion but lo’ and behold what happens next is Michael Arrington’s stand-in for February – Sarah Lacy decides to chime in with her two cents under the Techcrunch banner. Once she got over the techie geographical I know better than you attitude Sarah goes on to suggest that the old and stodgy car industries should be left to go bankrupt because it is inevitable that they will fail in the long run. So better now to get over the pain and agony instead of dragging it on longer than need be.

She then goes on to wax poetically about why she loves living in the valley amongst all the real movers and shakers

My above views are precisely why I live in Silicon Valley: A place that not only lacks an artificial reverence for an old stodgy company, it actually celebrates when a younger, nimble startup takes it down. How, could Friedman get why the Valley continually creates strong multi-billion dollar companies and then turn around and propose a government subsidy for us? Investments in agencies like DARPA are one thing, but government subsidies are crutches for non-performing industries. And hit by the recession or no, Silicon Valley doesn’t want or need that crutch.

The remainder of her 900+ words continued this love affair with all that the Valley and venture capitalist bring to the table and why Friedman was basically clueless in his assessment of what should be done with the bailout money. Now of course combining both the Techcrunch name with that of Sarah Lacy and you can be assured that the comments and rebuttals would be flowing hot and heavy; which they were with some 124 comments so far on the actual post at Techcrunch.

However what had been intended as a simple comment by Michelle Greer ended up being one of the best smackdown posts I have read in a while. As I read through each paragraph of Michelle’s post at her blog – Michelle’s Blog – my smile got bigger and bigger. You see there is an art form to a really good smackdown and it doesn’t always involve snarky language or over used sarcasm. Nope .. sometimes the best smackdown is the one that take each and every part of what you are arguing against and shows how it is wrong while backed up with facts you know from personal experience.

As with any good smackdown you first line up your target which is what Michelle did within the first section of her post

In sum, Sarah Lacy thinks that if the government offers stimulus money to VCs in a sort of competition for someone to find the cleanest tech, that this is somehow “bailing out winners”. OK, let me get this straight: the U.S., which is falling desperately behind in creating clean energy cars behind countries like Japan, Germany, and even India, shouldn’t give money to promote innovation even though energy independence is key to our national defense and economy? Is that correct?

Target set .. shot number one:

Here are some facts that Friedman probably knew that Sarah Lacy apparently does not:
1.) Electric vehicles are currently not very profitable. I knew a manager at Toyota. The Prius is a loss leader for them and is quite expensive to produce. Without government subsidies, it would be unlikely to be on the roads at all. The only reason why this manager liked carrying it is because customers would come looking for a Prius, find out how expensive it was, and then buy a a Corolla. If you think any company would take on the massive overhead with the hope that these vehicles will be cheap to produce, you aren’t being very realistic. The American people stand to gain the most by having clean air and energy independence. These cars can eventually be profitable, but it’s going to take some investment initially and I don’t see enough of that coming from the private sector.

Shot number two – go with facts you absolutely know

2.) The U.S. is currently exporting biodiesel to Germany, a government that does subsidize it because it promotes cleaner air and energy independence. How do I know this? I visited a biodiesel plant that actually did the exporting. Other countries see the value of bipassing the oil industry, which is capital rich but doesn’t actually employ a lot of people. Using alternate fuels means we can ignore corrupt governments like Saudi Arabia, Venezuela and Iraq. They will cease to be world players

For shot number three show you know something about the other person’s home turf

Before you go on and on about the Tesla, ask them how much of their cost is invested in their technology, and then figure out if you think the average American could actually afford that. Or how that person would actually go on a road trip when their car only goes 225 miles without a charge which takes 3.5 hours at least. The Tesla is still a bit of a toy. Sorry.

Yup .. all in all it was a smackdown as good as you would see on the WWF or at a PETA rally but a lot more fun.

Nothing better than a good old fashion smackdown is a post from: The Inquisitr

Citigroup, the American banking giant that survives today exclusively off the back of a $36.5 billion cash injection courtesy of the American taxpayer, is using some of those funds on high priced lawyers to sue a small New York pawn shop.

The bank alleges that All Citi Pawn infringes on Citigroup’s trademark by using the word “Citi” and with a logo that includes an arc.

Citigroup is seeking all of the business’ profits since it adopted the All Citi Pawn name.

Pawn shop manager Bob Kay told CNN: “What can I tell you? Its crazy. They’re going wild for a little art that I put up. Theirs is a moon shape, mine is a V-shape, but I’ve already taken it down.”

Your tax payer dollars at work America: thousand dollar an hour lawyers trying to put small businesses out of business. Makes you feel all warm and fuzzy inside, doesn’t it

Your bailout money at work: Citigroup sues All Citi Pawn is a post from: The Inquisitr

While polls showed the majority of American’s did not support a bailout of the auto industry, The Bush Administration acted anyway, throwing away loaning the industry some $17 billion. So what’s the first thing Chrysler does with its share of the money: a nation wide advertising campaign thanking America for the money.

The obscene nature though isn’t surprising given the industry is in the mess it’s in because of a long track record of ineptitude. Remember folks: GM and Chrysler were losing money 4 years ago, the economic crisis didn’t cause them to fail, their complete inability to run a business successfully did.

Obscene: Chrysler Spending Bailout Money on Ads Thanking America for Bailout Money is a post from: The Inquisitr

25% off when you spend $700 billion or more

Guy King can laugh, but Australian’s haven’t woken up to the fact yet that the RBA (Reserve Bank of Australia) has been pumping tens of billions into the financial system recently without any serious scrutiny…eventually though, some one is bound to notice.

RetailMeNot offers bailout discount code is a post from: The Inquisitr