The term sheet for the TARP explains when a recipient may repay the money early:
Senior Preferred may not be redeemed for a period of three years from the date of this investment, except with the proceeds from a Qualified Equity Offering (as defined below) which results in aggregate gross proceeds to the QFI of not less than 25% of the issue price of the Senior Preferred.
â€œQualified Equity Offeringâ€ shall mean the sale by the QFI after the date of this investment of Tier 1 qualifying perpetual preferred stock or common stock for cash.
Goldman Sachs received $10 billion from the TARP, so to repay it, they must first raise at least 25% of that in a private offering.
So let me get this straight. Goldman Sachs has issued tens of billions of dollars of debt insured by the FDIC. They have access to the TSLF, TAF, and the good old-fashioned discount window, where they can borrow at half a percent or less to finance their long-term investments. And of course, they received at least $13 billion in taxpayer money via AIG. (That certainly helps to explain the profits this quarter.)
But if they repay the TARP — just the TARP — they will be freed from any meddling government interference in, say, their executive compensation. And that is precisely what they are about to do. After all, these are the smartest people in the world; you cannot hire someone like that for a mere six or seven figures.
Ahhh, American capitalism at its finest. We truly have the best government money can buy.
www.goldmansachs666.com – This guy is stark raving mad, but that does not make him wrong. And he received a cease&desist order from GS itself, so go give him some page hits.
See also the case of the missing month. I couldn’t make this stuff up.