Sure, creditors have a right to information. I wonder how much information the government has asked for thus far, and how much of the “we refuse to disclose” was directed at media outlets who consider themselves the fourth branch of the government. As a creditor the Treasury Dept. would have a legitimate cause for getting access to more in-depth data. I’m opposed to the information being demanded and scrutinized by the trolls on Capitol Hill purely for power and ideological purposes, and then crippling the companies’ ability to function as a “private” (in my broader meaning) enterprise.

Private companies are owned by private individuals, partnerships, or even groups of people. But they have (relatively) few owners and don’t have to show their financials to anyone except the IRS and their owners.

Public companies are owned by shareholders. They are required by the SEC to file annual and quarterly financial disclosures, known respectively as 10-Ks and 10-Qs, that are available to anyone who wants to see them. They must further send this information to all shareholders.

Thus, JP Morgan Chase, et al, are not “private” companies. They are public companies, with stock that trades on the NYSE. They are owned by their shareholders.

But with any company, there is a simple accounting equation. Assets minus liabilities equals equity. Equity is what the shareholders own.

In the event of liquidation, taxes are paid first; then liabilities (i.e., the light bill, loans, bonds, and the like); then whatever is left is divied up among the shareholders, assuming anything is left. That holds true if you are public or private.

As a private individual, I don’t have to disclose where my money goes to anyone. Except when I do

First to demand access is, of course, the IRS. Then, should I try to borrow money, potential creditors are going to want to see financial information on me, too. I can hide all of it, although not easily if legally, by staying in cash.

The same is true with companies, public and private. Creditors can and do demand to see financial data as a condition of lending. The key here may be what the Government forced the banks to agree to before passing out bags of cash. Hopefully, some bright young lawyers at Treasury burned some midnight oil coming up with tight loan agreements.

But I wouldn’t bet the ranch on it.

a thousand apologies.

It’ll take a miracle….

(Sorry. Emboldened by my previous Princess Bride quote, I couldn’t resist another that seemed apropos.)

In seriousness, while they said they’re going to try to force transparency, two things:

1. It’ll take some extremely over-bearing federal regulation to do so;
2. 2) As some of those bank people pointed out, it’s not like TARP money was kept in it’s own bucket and used on its own for specific identifiable projects/loans/investments. A pile of cash is about the most liquid thing there is; keeping track of how much of the money went to this or that raises all sorts of other questions that make such an accounting difficult at best, if not a moot proposition — e.g., A bank gives out two loans after receiving TARP money. They claim that none of the TARP money went to Loan A, but lots of it went to Loan B. BUT… would both A and B have been given if no TARP money had been acquired at all? Would only A have been given? Only B? Both, but less to each? So then, how can we say that TARP money only went to B when there’s a real possibility that neither A nor B would have been given if TARP funds hadn’t arrived at all? And, if either A or B, or both, would have been given anyhow, but less to each, how can we say TARP money played no role in loan A? It all seems like trying to hold a wave upon the sand.

All that said, If the next wad of cash comes with strings, so be it. I’m opposed to the next wad of cash being handed out at all, and doubly so with strings attached — I trust the trolls in Washington far less than managers of corporate America to use the money wisely.

Not unless we give JP Morgan a safeword anyway.

Furthermore, if you read the referenced article, it is (thankfully) obvious that further accountability should be forthcoming.

So they can stick their reticence where the sun don’t shine, because they’re on the government dole now, and they can follow the rules that come with it.

“Get used to disappointment.”

First off, yes, I’m willing to accept the consequences. I fully expect bad times; part of my Cassandra-like bemusement is watching the present flailing that I really believe is only delaying an inevitable melt-down.

Second, I have absolutely no confidence that the trolls in the important positions in the federal government will get it right. The incoming Administration and the Democrats in power on Capitol Hill are smart in all the wrong ways, have dangerous ideas on economics, and are beholden to far too many special interests who desire policies antithetical to sound economic policy — the Freddie/Fannie connections to Dodd, Frank, Obama, et al. should be ample evidence for that. There is no reason at. all. to hope they will intentionally get it right.

Third, with that in mind, I trust the managers of private companies FAR MORE than those trolls. Yes, many of them needed a bail-out to avoid financial Armageddon. I’m not tickled pink that they got the bail-out, but I accept that the guvmint had to do something to clean up the massive mess they instigated in the free market. But I firmly believe they should do the least amount possible… giving un-earmarked, no-strings-attached money sounds about right. I just hope (and here’s where Adam Smith’s ‘invisible hand’ comes in) that those corporate managers don’t just decide to treat the guvmint as Uncle Sugar and expect to get more money when they burn recklessly through the last allowance check.

Fourth, I very much dispute the need for “good, old-fashioned Keynsian stimulus.” (Not least because that phrase implies two things that are not so — Keynsian policies are neither “good,” nor “stimulus.”) Public works projects should continue as needed, of course, but additional public works projects have the same effect as any other government spending program — they take money out of the free market system (the very system you’re trying to help) via taxes, and put the money in the hands of guvmint troll bureaucrats who, quite usually, are incapable of doing things efficiently, and have loads more red tape. Extra guvmint programs don’t stimulate the economy, they just contribute to guvmint growth and ever more guvmint growth.

Fifth, I completely, totally, wholly, excitedly agree that tax cuts are the way to go… but they are not any part of a Keynsian “stimulus” package. But yes, cut the tax rates for those who actually produce revenue and employ people — real people in real jobs doing real things, not artificial guvmint jobs created just to reduce the unemployment rate. Also, cut tax rates on those who actually work and earn a living and are trying to make their way (this, of course, completely excludes those who don’t pay any taxes anyhow — contrary to Obama’s campaign rhetoric, ya can’t cut what ain’t there)

Sixth, We can deficit spend our way out of this if and only if the size of the federal guvmint isn’t massively expanded… But, returning to one of my earlier points, I have no confidence, whatsoever, that such will be the case, so I have no confidence that things will get better any time soon and I’d rather go through the pain of the re-emergence of free markets than endure the long suffering of a socialist state. One is natural and comes from that spark of human desire; the other is imposed and smothers the flame of ingenuity.

As I said before, nothing in the legislation and subsequent transaction subsumed those companies into the government and reconstituted them as GSEs. Nothing required openness or transparency. They were given cash, not strings. I think it was the wrong thing to do — just as I think the governmental activity (or lack thereof) which contributed to the collapse was the wrong thing to do. Part of the reason it was the wrong thing to do, as I also said before, is PRECISELY THAT IT EMBOLDENS THEM TO KEEP GOING BACK TO UNCLE SUGAR because they have learned (as spoiled children) that Uncle Sugar will just give them more money.

But let’s think about your preferred scenario: So AIG/Citigroup/whomever goes all transparent and is found to be mis-using funds. What’s the repercussion? They have to give the money back… and then they fail…. annnnnnnd we’re back to square one. But we could have been at square one months ago and already at square two–the beginning of recovery.

Instead, because of the bail-out, we’re still flailing about trying to avoid square one and going down some dangerous roads. If the free market is to be restored, the first step is letting private companies be private.

I’ve been reading Blackhedd/Francis’ columns and I understand and accept that something had to be done to free up the credit market lest we incur financial Armageddon. But how did we get to that point? Why did that happen? The free market was seriously compromised (as you acknowledged) by governmental and corporate trolls who played the system. So it wasn’t the free market that failed, it was people — especially in government and in government-owned companies. The response is not to give those trolls more power and influence over private companies, but to take away the methods by which those trolls screwed the system up and caused the melt-down.

The government now is going to be full of malicious people.

I still trust the financial people more than I’ll trust Harry, Nancy, or Barry.

I don’t know where that leaves me, frankly. But not exactly in Happy Bunny territory.

The government decided — rightly or wrongly — to give public money to private institutions. That does not alter their essential status as private institutions.

Of course it does.

Define the difference between a GSE and what AIG is now. Both have made bad business decisions, forced onto them by politically correct pressure and laws.
Both have lost massive amounts of money.
Both have been poorly run.
Both have recieved public money to solidify thier balance sheets, both are carrying on with the same business practices that put them in this position.
Both have and will go back to Uncle Sugar for more money (too big to fail etc.)

Please. We do not have a free market. ANY company that takes public money to avoid the consequences of a Free Market punishment is now in effect owned by it’s recuer i.e. the US Taxpayer. And I want to know where my frickin’ money is. If you don’t want to tell me – fine. Give it back.
Whether you agree with the bailut or not, the consequences are a de facto nationalization of our financial system (complete with the forced acceptance of ‘bailout’ funds vis Wells Fargo). These are now gov’t companies.

Good thing we elected a republican 8 years ago…

So no, I’m not upset. I’m still upset about CRA, Fannie, and Freddie.