John At The Center

Meanwhile, the FT reports that the Federal Reserve has made a $14 billion profit on its various crisis-fighting loan programs. This is great! Let’s a have a financial crisis every year!

Actually no, let’s not. The other costs of the crisis—lost tax revenues, recession-fighting stimulus measures, etc.—will far outweigh any gains made on TARP or on Fed loans. And it’s still far from certain that TARP will end up in the black (the GM and Chrysler loans in particular still look quite risky). But the increasing likelihood that it won’t be a big drain on the government’s purse is an interesting and politically significant development.

via TARP and the Federal Reserve make money off the financial crisis – The Curious Capitalist – TIME.com.