From the NYT:
The independent panel that oversees the government’s financial bailout program concluded in a year-end review that, despite flaws and lingering problems, the program “can be credited with stopping an economic panic.”
However you feel about the massive moral hazard created in the process, it is worth noting that, on its own terms, the bank bailout has been a success.
I'm using the word "bailout" here, because it's hard to view TARP in isolation from various other Fed- and FDIC-coordinated programs that prop up the credit markets with guarantees and quantitative easing. As the panel notes, TARP itself is a kind of amorphous blob of allocated money:
In the latest monthly report released on Wednesday, the panel again criticized the Treasury Department under Secretary Timothy F. Geithner for “failure to articulate clear goals or to provide specific measures of success for the program”
Off the top of my head, it's been used to:
- Prop up paper asset prices (The original concept).
- Prop up house prices.
- Prop up car prices (C4C).
- Bail out car makers (Auto bailout).
- Lower bank gearing ratios (TARP Classic II).
- Lend to small business (upcoming).
- Prop up appliance prices (upcoming).
and I am probably missing some. The other interesting thing is that the bank equity part of TARP is somewhat in the money:
The bank bailouts are turning a small profit, Treasury said.
There's a caveat here, which is that this probably wouldn't be true if the financial sector wasn't able to fund itself at historically low cost. But still, at least one part of Obama's three-part economic plan is a success on its own terms, which is worth pointing out.
HAMP numbers are coming out soon.