government to profit from sale of bailout

[netrox]

The U.S. government is poised to make a pretty penny over the next six months thanks to Citigroup (C), reports the Wall Street Journal. Morgan Stanley (MS) will slowly sell its 27 percent stake in the company. Citi represents one of the government’s “last remaining stakes in a Wall Street banking giant.” Helping the government’s possible profit is an increase in stock price simply from the expectation of government ownership being removed. The exact profit is apparently debatable, with the WSJ reporting $7 billion and the Los Angeles Times saying $8 billion. The actual sale of the 7.7 billion shares will be slow, especially “given that a single quick sale could cause a sharp drop in Citigroup's stock price,” according to the Times. Almost two years ago, no one knew if the government would ever see the $25 billion investment returned, and now the profit will be the largest from any Troubled Assets Relief Program investment.

Citi To Return TARP Investment and More | Reuters

Wait? I thought we're on the path to socialism? Darn! *sarcasm*

 

[kokonut]

We are.

Hmm... $7 billion out of almost $2 trillion spent so far represents what? 0.3 percent or 0.003.

Kind of like you having a $10,000 debt on your hand and you managed to save $30 bucks. Now, because you saved $30, you might think you're on the path of recovery and go out and spend another couple of thousand of dollars to celebrate.