banks still paying dividends with bailout cash

Discussion in 'Financial Cents' started by Tango3, Nov 2, 2008.

  1. Tango3

    Tango3 Aimless wanderer
    Sorry (the Washington post wants you to register to use the link...)
    Bailout Money Is for Lending, Critics Say

    By Binyamin Appelbaum
    Washington Post Staff Writer
    Thursday, October 30, 2008; Page A01

    U.S. banks getting more than $163 billion from the Treasury Department for new lending are on pace to pay more than half of that sum to their shareholders, with government permission, over the next three years.

    The government said it was giving banks more money so they could make more loans. Dollars paid to shareholders don't serve that purpose, but Treasury officials say that suspending quarterly dividend payments would have deterred banks from participating in the voluntary program. Seems to me it should be their choice to fail or not.

    Critics, including economists and members of Congress, question why banks should get government money if they already have enough money to pay dividends -- or conversely, why banks that need government money are still spending so much on dividends.

    "The whole purpose of the program is to increase lending and inject capital into Main Street. If the money is used for dividends, it defeats the purpose of the program," said Sen. Charles E. Schumer (D-N.Y.), who has called for the government to require a suspension of dividend payments.
  2. ghrit

    ghrit Bad company Administrator Founding Member

    Can't find the smilie for pure disgust.
  3. Quantrill

    Quantrill Monkey++

    Again, just shows these a-holes have not a clue. Surely if they screw up again the good ole taxpayer will be glad to help them out.

    Where are the outraged people in the streets? There should be demonstrations, protests, petitions, something. Maybe people think it would accomplish nothing so do nothing. I dunno?

    I am convinced that nothing will change until people can't afford cable and food.

    Sorry for the rant, I am just angry with the way this "bailout" is being played out.
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