THIS IS NOT A POSITIVE DEVELOPMENT
Paying your Visa bill with your MasterCard.
Banks Used Two Billion In Govt Loans To Repay TARP
An Obama administration program is under fire, with federal investigators finding that community banks used government funds to pay back TARP bailouts -- instead of lending the money to small businesses as originally intended. The watchdog report found that $2.1 billion of the administration's $4 billion Small Business Lending Fund went to repaying bailouts instead of providing loans to small businesses.
In other words, funds were used first to pay off TARP bailouts, then considered for use as small-business loans.
Some in the banking industry said certain banks looking for a way to get rid of the high-interest TARP loans entered SBLF specifically to get low-interest financing to pay off their bailouts. Cliff McCauley, a senior vice president at Frost Bank in San Antonio, told CNN that he steered clear of both programs, adding:
"Everyone went in thinking it was one of the ways to pay back TARP." Banks bailed out by TARP were repaying the money at interest rates ranging from 5 to 9 percent. SBLF funds could be repaid at 1 percent interest.
Congress initially appropriated $30 billion for the SBLF, but only $4 billion of those funds were ever used. The report also stated that former TARP banks that received money from SBLF but failed to increase lending won’t be penalized for their actions.
COMPLETELY F---ING RIDICULOUS
Video is not embedded. Click image to watch at Fox.
Judge Napolitano explains to Neil Cavuto:
Can you imagine the absurdity? You owe me money, so I'll lend you the money with which to pay me back the money that you owe me? That is literally what is being done with taxpayer dollars.
That is sort of like you and me paying our Visa bill with our MasterCard.