Bloomberg: summary of terms and my own reading between the lines summary is below...
Here's my summary:
- We give the incompetent bank, aka Citigroup, 20 billion
- We guarantee lousy bankers will get paid back for 306 billion of loans they incompetently made without any risk management.
- If somehow the fraudster home flippers don't pay the mortgage, the folks who collected huge bonuses for years will give us back our 20 billion plus give us 9 billion more. Of course we have to the pay the bank whose executives gave a lot of money to the Republican party 306 billion plus interest. But no worries the too big to fail bank will pay us interest on our 20 billion. But wait, 306 - 20 billion, well really we get nothing from Citigroup and will pay THEM interest on 286 billion.
- Ah but we get some Citigroup preferred stock shares. Citigroup stock traded at $3.77 Friday. But we get preferred shares at $10.61 a share. The stock needs to triple for these shares to be in the money. By the way, ALL of the stock of Citigroup was only worth 20 billion at Friday's market close. We are risking 300 billion for a part of a company worth only 20 billion...
Yes I know, the world will end if we don't invade Iraq, listen to everyones communications, pass the TARP within a day, use the TARP to buy trash for cash do exactly this right away.
I like Robert Reich's commentary around this one.