Given the speed at which the federal government is throwing money at the financial crisis, the average taxpayer, never mind member of Congress, might not be faulted for losing track.
CNBC, however, has been paying very close attention and keeping a running tally of actual spending as well as the commitments involved.
Three-point eight trillion dollars. That's $3,800,000.000.000. More than what was spent on WW II, if adjusted for inflation, based on our computations from a variety of estimates and sources*.
Here are the figures:
(TAF) Term Auction Facility $900
Discount Window Lending
Commercial Banks $108
Investment Banks $102
Loans to buy ABCP $108
AIG $122
Bear Stearns $29.5
(TSLF) Term Securities Lending Facility $225
Swap Lines $519
(MMIFF) Money Market Investor Funding Facility $540
(TARP) Treasury Asset Relief Program $700
Other:
Automakers $25
(FHA) Federal Housing Administration $300
Fannie Mae/Freddie Mac $150
Total $3828.5
That's a lot of money
7 comments:
One glaring flaw in this analysis is that it seems to assume that all of this money is spent money of which we'll never see another dime. Much of the money going out the door is in the form of loans, not just dumping dollars. So it's not really reasonable to compare this to WW2 in terms of spending.
What does concern me though is all that money is focused almost exclusively on the financial sector. The rest of the economy is hitting the skids now too. So how much money will be available to help resuscitate the rest of the system?
Are you aware of the Leo Wanta story at www.worldreports.org/news? It explains alot of the weird stuff that is going on, what is increasingly looking like a massive crime from this administration.
sterno is correct. Technically it's not like we *gave* $3.8 trillion to our irresponsible crazy gambler uncle Ed--we actually only *loaned* Ed the money.
And I just *know* he's good for it...
Sterno, good point.
Perhaps the Fed could securitize come of that loan paper to raise money to bail out the manufacturing sector... :)
and this waws not enough to get a loan to Lehman. After all this costed the republican the presidency adn started the crisis of confidence. I have a Lehman issued product (not equity) so all I can say Ha-Ha-Ha
That would be all well and good until uncle Ed looses his job and can't pay it back.
Just wondering at what point does the defecit cause a total collapse? Aren't we at a point where we borrow just to pay the interest?
As to uncle Ed, the reality is that these loans are likely to be paid off, at least in party. AIG, for all it's problems in the CDS market has a lot of valuable assets and business underneath. Most of the companies that got into trouble are a mix of solid financial business blended with some poor speculative investments. So while we're loaning them a bunch of money and inevitably we'll lose some of that, the odds are a good portion will be paid back.
As to Demeur's question:
Just wondering at what point does the defecit cause a total collapse? Aren't we at a point where we borrow just to pay the interest?
The best measure for our debit position is the ratio of debt to GDP. We have a massive GDP so we can maintain a massive debt. Our debt ratio is lower than a lot of other industrial countries like France, Germany, and Japan.
Furthermore, because Treasuries are seen as a safe asset still, people are willing to loan us money through those at very attractive rates. The yield on the 10 year is still 3.59%. That's a pretty damn good rate to be borrowing money at. So long as we're a more attractive investment than other countries, we should continue to be able to borrow at those rates.
In FY 2008, we spent $412 billion on interest payments. Total budget was $2.9 trillion. So it is a bit alarming that we're paying about 14% of our total budget on interest payments. Of course that's just the baseline budget and doesn't account for all the stimulating that's going on.
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