So-so news on TARP warrants

July 23, 2009

HuffPo reports Treasury has allowed three more banks (including Goldman) to pay back warrants, before Congress has had a chance to force them to setup an auction system.

BUT

They also report that GS paid full price for theirs (using professor Wilson’s models).  Wilson speculated that “Goldman Sachs decided to pay fair price to avoid more of the bad press that’s been coming its way the last several months”.

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One Response to “So-so news on TARP warrants”


  1. The argument on the side of GS is of course that they never asked for the TARP money. Those terms were imposed on GS, free market mechanisms were put aside. Therefore it may not be entirely obvious that the return of the warrants should be governed by the free market either.

    Of course GS benefited hugely from the bailout money, perhaps even more so indirectly. Because of that GS has little reason to complain.


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