13 Bankers: The Wall Street Takeover and the Next Financial Meltdown — CHAPTER 6: TOO BIG TO FAIL

1. 1. The US government injected $250 billion into banks via TARP in October 2008, forcing nine major banks to accept capital on terms that heavily favored the banks.
2. 2. The TARP bailout effectively subsidized banks by an estimated $78 per $100 invested, according to the Congressional Oversight Panel.
3. 3. The Federal Reserve's secret payments to AIG's counterparties, including Goldman Sachs, amounted to a backdoor bailout of Wall Street banks.
4. 4. After the bailout, the five largest US banks grew even bigger, controlling 96% of the derivatives market by notional value in 2009.
5. 5. The Obama administration rejected proposals to break up large banks or nationalize insolvent ones, instead pursuing stress tests that were lenient on capital requirements.
6. 6. Goldman Sachs reported record trading revenue in 2009, partly from trading with the Federal Reserve, and paid record bonuses.
7. 7. The financial crisis cost the US economy over 7 million jobs and $2 trillion in lost output by 2009, with unemployment reaching 10%.
8. 8. Key Obama administration officials, including Geithner and Summers, had close ties to Wall Street, which influenced their bailout decisions.