U.S. Banks with bailout money to continue paying shareholder dividends

October 29, 2008 by · Leave a Comment
Filed under: Policy News 

Well here is what we get, so enjoy.  Not only have we as a country (I disagree) agreed to bailout financial institutions that made bad decisions in a free market and if we could audit them, we would most likely see that they are insolvent based on the assets/liabilities.  This is just icing on the cake, we are now going to give them our taxpayer money and they are going to payout $86.5 billion dollars over the next 3 years.  

Why is it they don’t have the money to lend but do have the money to pay their shareholders?  We have been hoodwinked in my opinion so either everyone who reads this, calls their representatives and make a real fuss or let this travesty continue.

News:

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.

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.

Source: Washington Post 

 

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