TARP (Troubled Assets Relief Program)

The Troubled Asset Relief Program (TARP)

It is a program of the United States government to purchase toxic assets and equity from financial institutions to strengthen its financial sector that was passed by a Democratic Party controlled Congress and signed into law by Republican Party President George W. Bush on October 3, 2008. It was a component of the government's measures in 2008 to address the subprime mortgage crisis.

It was basically to stabilize the country’s financial system, restore economic growth, and mitigate foreclosures in the wake of the 2008 financial crisis. TARP sought to achieve these targets by purchasing troubled companies’ assets and stock.

HealthSouth Scandal

HealthSouth was the largest publicly traded health care company in the U.S. The fraud included the inflation of the companies earning numbers by about $1.4 billion to meet the expectations of stockholders. Richard Scrushy, the CEO of the company, would tell the people under him to fake transactions and make up random numbers. Richard kept this up from 1996 to 2003. A crucial mistake that Richard made was selling $75 million worth of stock right before the company released a posting of a huge loss. This made the U.S Securities and Exchange to become skeptical and begin investigations on the company. At the end of the investigations, Scrushy was not found guilty and freed of 36 accounts of accounting fraud but instead sentenced to 7 years in prison for trying to bribe the governor of Alabama.

mohamed atta

Mohamed Atta was one of the main leaders in hijacking the American Airlines flight 11 and crashed it into the north tower of the twin towers. He was born in Egypt and moved to Cairo at the age of 10. He went on to study architecture at Cairo University and Hamburg University in Germany. Atta first became involved in Al Qaeda in Germany and then disappeared to Afghanistan for a few months when he met Bin Laden and got recruited by Bin Laden to help him attack the United States. Atta came to the U.S in June 2000 and went into piolet school. From there he started training to be a piolet so he could hijack the plane and fly it into the twin towers.

Abu Musab al-Zarqawi

Abu Musab al-Zarqawi was a born in Jordan on October 30, 1966. Prior to him becoming a well known terrorist fighting against the United States, al-Zarqawi was recruited to the Mujahideen in the late 80s a group of Islamists fighting against the USSR. Al-Zarqawi didn't end up going to Afghanistan until 1989 when the Soviets were already moving out. Because of this he decided to become a reporter for an Islamist newsletter. After being for a reporter for a while al-Zarqawi moved back to Jordan and started helping a local militant group smuggle weapons and explosives. He was found out so he was arrested and sentenced to 7 years in jail. After his release from jail in 1999 al-Zarqawi went back to Afghanistan and with some money given to him by Osama bin Laden he set up a training camp. In October of 2001, al-Zarqawi helped fight against the Untied States in the invasion of Afghanistan. During the fight al-Zarqawi got shot in the chest and fled to Iran. After receiving medical treatment in Iran he moved to Iraq and planned multiple suicide bombings and hostage executions. By this time al-Zarqawi was on the radar as a terrorist. After years of hiding and evading the US al-Zarqawi was killed in a drone strike on June 7,2006.

Swift Boaters

Swift boating is used to describe an unfair or untrue political attack. The name is obtained from the organization "Swift Boat Veterans for Truth". The reasoning was because of their widely publicized and later discredited campaign against 2004 US presidential candidate John Kerry. After that political smear campaign that term has commonly been used to refer a harsh attack by a political opponent that is dishonest, personal, and unfair. Swift boat veterans objected to use this term to define a smear campaign.

Enron

Enron was an American energy, commodities, and services company. It is based in Houston, Texas, founded in 1985. It is a merge between Houston Natural gas and InterNorth. They employed around 29,000 people as well as they claimed revenues of nearly $101 billion during 2000. Unfortunately they went to bankruptcy in December 3rd of 2001. Before that tragic event they were named "Americas most innovative company" for six years straight. Enron's reported financial condition was a creatively planned accounting fraud. After this event there has been more questioning about accounting throughout every corporate. Also affected the greater business world by causing the dissolution of the Arthur Anderson accounting firm which had been Enron's main auditor for years. It ended it's bankruptcy in November of 2004. It was due to a court approved plan of reorganization.

TARP

TARP, or the Troubled Asset Relief Program was a program signed by President George W. Bush in October of 2008.  TARP's purpose was to help guide the economy out of recession by the involvement of government.  It gave the US Treasury $700 billion to spend on stagnant and undesirable assets, such as property from failed mortgages, from banks and financial institutions alike.  This would help relieve the falling housing market and uptake the excess supply of property.  Banks and financial institutions which owned failed mortgages would be able to be saved.

The division of spending was as follows:

$250 billion to programs stabilizing banks

$27 billion to restarting credit markets

$82 billion to restabilizing the automotive industry

$70 billion to stabilize AIG

$46 billion to assist families undergoing foreclosure

(These numbers do not add up to $700 billion because the total spending was attempted to be reduced to $475 billion)

The US government today reports that TARP was successful in correcting the collapsing economy as well as producing a $65 billion profit for the government simultaneously.