The federal government gets TARP right

Sometimes the best investment is the one you didn't make. That's the case with one of the biggest investment pools in the country: the $700 billion Troubled Assets Relief Program, which Congress authorized last October to help combat the financial meltdown. The smartest thing the Treasury has done is to not buy troubled assets with the money. Instead, it has used most of it to buy preferred stock in banks to shore up their capital.

There was lots of yowling when the Treasury wisely changed its mind in November - critics yelled "bait and switch" because the pre-Obama Congress would never have approved a plan for the government to buy ownership stakes in banks. But forgoing asset purchases has turned out to be the right decision.

Read Full Article from CNNMoney.com

- Posted: 2009-06-08 08:54:50

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