Managing partner of Chapwood Investment Management, Ed Butowsky appears live as a co-host of Varney & Co. on Fox Business News to discuss Ed’s top headline of the day – troubled small community banks giving up board sets to the Obama administration.
Ed explains that Obama administration failed to develop or impose any oversight into the tarp bailout money over small community banks. As a result these banks have failed to pay out any dividends back and the administration is going to start taking up board seats at these banks. The hope is that the government will be able to start monitoring these banks.
Is this a blunder on the administrations part or banks part? Ed explains when the Obama administration provided over $30 Billion of TARP money to these banks and small community banks they just gave it – there was not a lot of screening. In light of this fact, does it surprise anyone that now there are over 132 banks that have not paid any dividends? Ed says no. Could these actions, or lack thereof, by the administration been done to allow for TARP to be given to “favorite” banks residing in the backyards of some of these congressmen? In other words, if we scrutinize the process for a large bank “A” then we certainly have to scrutinize a smaller community bank “B” which could be in some prominent congressman’s backyard that they are trying to help keep alive. Ed quickly replies that there seems to be something behind the scenes thats driving these actions or lack thereof. This raises a lot of taxpayer eyebrows when you think of where did all this money go and how much of it really got spent and what has it accomplished – you be the judge.
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