Senate Hearing on Winding Down of TARP

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Neil Barofsky, the Treasury Department’s Special Inspector General for the Troubled Asset Relief Program (TARP) said today the “financial markets believe more than ever than the United States government will step in and save the ‘too big to fail’ institutions should there be another financial shock.” He made these comments at a Senate Banking Committee hearing on TARP oversight.
He was joined by Congressional Oversight Panel (COP) Chairman and former Senator Ted Kaufman, whose group released its final report yesterday. The report concluded that while TARP “does not deserve full credit for preventing a depression, it did “quell the immediate panic and helped to avert an even more sever crisis.”

In the same report, COP concluded that the federal intervention transformed the concept of “too big to fail’ into an established reality for big companies. COP Chairman Kaufman presented his agency’s report to the committee and outline the study’s findings.

Other witnesses included Timothy Massad, Acting Assistant Treasury Secretary for Financial Stability, who’s in charge of implementing TARP as well as the Government Accountability Office’s (GAO) Thomas McCool. South Dakota Democratic Senator Tim Johnson chaired the hearing.

Kaufman appeared on C SPAN’s Washington Journal earlier this morning.

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