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TARP – The New Improved Resolution Trust Corporation to Guarantee Corruption is Rewarded
With the TARP beginning to ramp up its activities, the government will be doing essentially the same thing it did for failed Savings & Loans with the RTC: using taxpayer money to buy inflated securities at higher prices and then sell them later on. Officials state that the government may actually make money from the program, but it is difficult to see how currently troubled assets will be more valuable than future worthless assets as the economy continues to deteriorate.
How Are the S&L Crisis and the Subprime Collapse Similar?Numerous commenters have pointed out similarities between the Savings and Loan crisis of the late 1980s and the recent collapse of the subprime mortgage market. Greed, corruption, fraud, Wall Street money, deregulation, political manipulations: all are blamed for both crises. But the real story is that of the government specifically setting up an industry to fail, and pumping that market full of cheap, easy money before the inevitable collapse.