By Surly Trader
Matt Taibbi has been one of the lone voices in the media who has consistently called out the ridiculous bailouts of this last global financial crisis. In his latest Rolling Stones piece, he attacks the TALF program and the risk-free loans provided to the few wall-street elite. It is bone-chillingly unbelievable, yet absolutely true.
Christy is the wife of John Mack, the chairman of Morgan Stanley. Susan is the widow of Peter Karches, a close friend of the Macks who served as president of Morgan Stanley’s investment-banking division….
Neither seems to have any experience whatsoever in finance, beyond Susan’s penchant for dabbling in thoroughbred racehorses. But with an upfront investment of $15 million, they quickly received $220 million in cash from the Fed, most of which they used to purchase student loans and commercial mortgages. The loans were set up so that Christy and Susan would keep 100 percent of any gains on the deals, while the Fed and the Treasury (read: the taxpayer) would eat 90 percent of the losses. Given out as part of a bailout program ostensibly designed to help ordinary people by kick-starting consumer lending, the deals were a classic heads-I-win, tails-you-lose investment.
It is worth it to read the full article – Matt Taibbi – The Real Housewives of Wall Street