Treasury loses on bailout investments
Heading up the steps of the U.S. Treasury Department
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All right, in this environment it's not easy to tell a good investment from a bad investment. But what's the government's excuse? A congressional watchdog says taxpayers overpaid by the billions when they bailed out troubled financial institutions. The worst investments were . . . drumroll please:
[Sound of a drumroll]
Citigroup and AIG. Marketplace's Dan Grech reports.
Dan Grech: The report found that Treasury overpaid by $78 billion.
Harvard Professor Elizabeth Warren chairs a panel that keeps tabs on the bailout. She says Treasury lost money on nearly all of its investments, but those losses varied.
Elizabeth Warren: For every $100 invested in Wells Fargo, for example, Treasury got back about $93. By contrast, with Citigroup, it got back about $62.
In the report, the independent firm Duff & Phelps compared government bailouts to investments made by the private sector. It found private firms made a killing, even as taxpayers got bilked.
Berkshire Hathaway's $5 billion investment in Goldman Sachs in September had an immediate return of 10 percent.
That means Warren Buffett's firm made $500 million in one day -- if anyone's counting.
I'm Dan Grech for Marketplace.