AEM professor Steven Kyle recently spoke out about the foolish decision not to purchase equity positions in the bank bailout bill 18 months ago. While the Bush administration didn't lose any money in the bailout, they certainly left a fair amount sitting on the table for taxpayers to not enjoy: "The upside of doing this is that rather than getting 8.5 percent on the repaid loans, the taxpayers would instead get to sell the equity back into the market at a much larger return."What is disappointing to me is that the Bush administration only went so far as to loan the money to the banks rather than taking a controlling equity interest in them. If the Feds put more money into a bank than the entire value of outstanding stock, as in some cases they did, then a good case could be made for taking direct ownership of the company. As a matter of fact, the Swedes did exactly this a few years ago.
 |  | |
 | ||
