More evidence of how the US government is providing welfare for the rich. In the latest Rolling Stone, Matt Taibbi's writes about how Wall Street housewives were bailed out by US taxpayers.
The piece focuses on Christy Mack, the wife of Morgan Stanley chairman John Mack, and her business partner Susan Karches who is the widow of the former president of Morgan Stanley's investment-banking division. Ms. Mack and Ms. Karches founded a company in 2009, Waterfall TALF Opportunity, which then got a bailout loan of $220 million from the government.
The interesting part here, as Taibbi explains, is that neither woman appears to have any serious history in business, apart from a few philanthropic experiences. Still, they were well connected enough to have the US Federal Reserve handing them both low-interest loans of nearly a quarter of a billion dollars through a complicated bailout program. It was a nice little earner that guaranteed them millions in risk-free income.
And in case you think Mrs Mack was doing it tough, you might want to check out her carriage house with its 12 car garage here. It only cost $13.5 million.
Now the loan program was originally designed to encourage consumer lending and spending which had dried up during the financial crisis. But instead of lending the money to small business, car buyers, students and credit card holders, – that would be socialism – the Federal Reserve gave the money to banks, hedge funds and financial institutions.
Welcome to socialism, US style.
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