Via Joe Weisenthal, we have Mark Patterson — an investor who “took advantage of the TARP’s matching funds” to purchase a Michigan bank — claiming that the taxpayer funded bank rescue is a “sham,” and that taxpayers will not see much of a benefit from their investment:
“The taxpayers ought to know that we are in effect receiving a subsidy. They put in 40pc of the money but get little of the equity upside,” said Mark Patterson, chairman of MatlinPatterson Advisers…Mr Patterson said it would be better for the US to bite the bullet as Britain has done, accepting that crippled lenders must be nationalised. “At least the British are not hiding the bail-out,” he said.
We’ve expressed concern before that, under the Geithner plan, taxpayers shoulder an disproportional amount of the risk while not seeing enough of the upside. And indeed, according to a “convoluted deal” agreed to earlier this year, MatlinPatterson has come to own 80 percent of the shares in Flagstar Bancorp of Michigan, while the US government “has ended up with under 10 percent.”