CNBC says
the bailouts have cost over $900 billion, so far:
The U.S. Federal Reserve stepped in to rescue insurance giant American International Group from bankruptcy with an $85 billion loan on Tuesday, the latest in a series of bailouts and loans for the financial and housing sectors.
The action brings the total tab for government rescues and special loan facilities this year to more than $900 billion.
- $200 billion for Fannie Mae and Freddie Mac...
- $300 billion for the Federal Housing Administration to refinance failing mortgage[s]...
- $4 billion in grants to local communities to help them buy and repair homes...
- $85 billion loan for AIG...
- At least $87 billion in repayments to JPMorgan Chase for providing financing to underpin trades with units of bankrupt investment bank Lehman Brothers...
- $29 billion in financing for JPMorgan Chase's government-brokered buyout of Bear Stearns...
- At least $200 billion of currently outstanding loans to banks issued through the Fed's Term Auction Facility...
The new bailout plan announced yesterday may cost another half trillion:
Treasury Secretary Hank Paulson briefed Congressional leaders on plans to address the "illiquid assets" on U.S. financial institutions' balance sheets, possibly including the creation of a government facility to take on financial firms' bad debts.
The proposal to create a massive facility to buy mortgage-backed securities could cost as much as a half-trillion-dollars and would involve the purchase of both private-label and government-guaranteed mortgages, according to an administration official.
The plan would have two parts. The largest part would be the purchase of private-label (those underwritten by Wall Street) mortgages by some as-yet unnamed vehicle. Financing would occur through the sale of treasuries, the official said. That part of the plan would require congressional approval. The idea is to hold the securities to maturity. The average mortgage has a life of about 7 years.
A second part of the plan would involve the purchase by Treasury of additional government-backed (Fannie Mae and Freddie Mac) under a plan it announced several weeks ago to rescue the two government-sponsored entities. Back then, it said it would purchase $5 billion initially. The idea is to ramp up those purchases more quickly. It does not require approval by Congress. ...
CNBC first reported the creation of a Treasury plan, similar to the Resolution Trust Corp., that would take mortgage backed securities off the market. ...
A federal government plan could also involve FDIC-type protection for money market funds, according to a report in the Wall Street Journal.
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