4 Years After TARP - Winners, Losers, Bubbles, And Troubles

Tyler Durden's picture

Four years ago today, the Troubled Asset Relief Program was signed into law. We thought it timely to take stock of different asset price levels with respect to that magnificent day in the history of our country as well as how a broad cross-section of global asset markets have performed relative to their pre-crisis peaks. Of the major US banks, Wells Fargo has done the best (-2.3%) while BofA and Citi are worst (down ~80%). As Goldman notes, two features stand out when we look at the broad markets: asset markets that have outperformed and are closer to pre-crisis peaks are either ‘defensive’ in some way, or have benefited inadvertently from the ‘Great Easing’ in response to the crisis. From precious metals and Swedish and Canadian house prices at the top to European bank stocks and US Growth at the bottom; 'hard assets' and 'defensives' combined with central bank yield compression has, as we would expect, dominated performance.


US major financials...since TARP (10/3/08)


Cross-asset-class retracement of pre-crisis peak...


and drilling down...

Equities - DM Defensive and Smaller EMs have surpassed pre-crisis peaks, and Majors nearing those peaks...


Bonds & FX - well above their pre-crisis peaks...


In the case of some of these nominal recoveries, it's as if the crisis had never happened - just how the central planners had 'planned' it - though the evidence of newly forming bubbles is clear.


Source: Goldman Sachs

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gjp's picture

With the performance of Apple, Amazon, other internet stock, various growth retailer and retaurants I can't believe that US growth ranks so low.  The triple digit PE momentum barrage of the last several years hardly indicate that defensive trends dominate.  Not that defensive hasn't worked too.  Seems like everything is a winner except for savers, Foxconn workers, and the future in general.

max2205's picture

What crisis? My wallpaper is USD though

techstrategy's picture

I suspect those suspects are in the "consumer discretionary" bubble bucket.

orangegeek's picture

Here's what TARP has done for us - delayed the inevitable.


This "bull market" has been in play for almost four years.




The government is out of cash, out of interest rate reductions and out of time - what was delayed will have to be dealt with.  It's not going to be pretty.

brewing's picture

get a little hyperinflation to kick in and it will come quicker...

Josephus's picture

physical; bitchez.

I am Jobe's picture

Buy an IPHONE Bitchezzz. Nothing else matters.

Roubinesque's picture

Bronze placque in my brain describing Goldman, circa 2008-2012

"Squid Employees got rich, Squid Investors got squashed."

IMA5U's picture

WFC = Buffet's Bank


Of course it has done the best


He cheats!!!

Cabreado's picture

TARP et al = reaction to and by corrupt forces gone too far, as they always do.
Miscalculation... always, eventually.
Raunchy, pathetic end-game material, all fluffed-up to keep the masses at bay for another day.

No charts needed, but thank you anyway.

conspicio's picture

TARP: The Movie


Elizabeth Warren as Madame Fauxcahantas

Ken Troske as Dr. Ken Badhairski

Dick Nieman reprising his recurring role as "Nancy's Beeyatch"

Jeb Hensarling as the Budget Nanny

Ted Kaufman as Mrs. Joe Biden

John Sununu as Mr. Akin ConvergEx

J. Mark McWatters as himself

and also featuring:

Damon Silvers as Union Thug #5

markar's picture

Wells Fargo is merely the least smelly turd in the bowl.

paradism_'s picture

Ha. TARP, free cash.

Saw an office in D.C. that had the motivational poster on the wall: Corruption- the best way to make money.

TARP was a handout to K Street and lower Fairfield County.

Obviously, the middle class is being eliminated, and two economies are being created: have and have-nots.

Yet the have-nots seem to have a fierce complacency. 

Thucydides's picture

I know something that you dont know. Thats right jack! The man is clear in his mind but his soul is mad! He's dying I think. He hates all this. He hates it! The man's ahhhh he reads poetry out loud......alright? And a voice....a voice....what are they going to say about him after he is gone? If he dies, when it dies, what are they going to say about him? He was a kind man? He was a wise man? He had plans? He had wisdom? Bullshit! Am i going to be the one to set him straight? Wrong!

firstdivision's picture

Why no Icelandic bonds listed in the bond graph?  Is GS afraid of countries that handle bad debt the proper way?