… Uncle Sam is having problems with bailout investments in supposed blue chip financial institutions. The Associated Press reports that the $27 billion in stock intended to eventually earn taxpayers a profit as part of the massive bank bailout has lost a third of its value — about $9 billion — in barely one month. The Treasury’s explanation is that it is not day trading but in for the long term.
It could be a very long term. The Congressional Budget Office said the government ran a $408 billion deficit in just the first two months of the current fiscal year. Between the bailouts and slumping revenues, the government is currently on course to run a deficit of over $1 trillion.
However long this recession lasts — and the two longest postwar recessions both lasted 16 months — we’re going to be forever paying for it.