Strong banks will be allowed to repay bail-out funds they received from the US government but only if such a move passes a test to determine whether it is in the national economic interest, a senior administration official has told the Financial Times.
“Our general objective is going to be what is good for the system,” the senior official said. “We want the system to have enough capital.”
His comments come as Goldman Sachs, JPMorgan Chase and other relatively strong banks are pressing to be allowed to repay their bail-out funds. On Sunday, Lawrence Summers, President Barack Obama’s top economic adviser, told NBC’s Meet the Press that repayments could eventually help the government provide further resources to help the sector. Such a move could also allow healthier institutions to differentiate themselves from weaker banks and free them from constraints on executive pay, and other activities, that come with bail-out money.
“Not surprisingly different banks are in different situations; they are going need different levels of assistance of taxpayers,” Mr Obama told a press conference at a summit in Trinidad on Sunday, while promising: “I’m not going to simply put taxpayer money into a black hole.”
But if I see a chance to keep these financial institutions under my thumb, don't think for a minute that I'm going to let it get away...it's all about power and control, after all. He who controls the money wins the game.
We all knew it was a bad idea to go down the bailout road from the very beginning - remember the joy when the House initially defeated the first bailout bill, last year? Mark my words - this administration, freshly returned from a trip to rub elbows with socialist thugs like Hugo Chavez, will seek to nationalize our banking industry. And that will be just the beginning.
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