Word Pro - Political Economy of the Bailouts of 2008-10 (4)

The bailouts of 2008 have also been politically unpopular, with many critics insisting that government should not intercede in the dynamics of a . (For more on government intervention, see )

The Royal Bank of Scotland has reported its fourth year of losses since the bank's bailout in 2008.

ast week, the Congressional Budget Office (CBO) released a with what seemed like good news: the bailout of 2008 – which fronted $700bn in taxpayer funds to prop up the financial institutions that brought the economy to the brink – ended up cheaper than expected. The price tag was revised down to $21bn from $24bn.


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RBS reports fourth year of losses since bailout in 2008

Under new EU rules, government funds cannot inject money into banks if bond holders have not taken losses first. The move is intended to avoid a re-run of the tax payer bailouts of 2008 but was targeted at major City investors. In Italy, though, small investors could get hit. Some €2.1bn of MPS bonds are owned by retail investors – people, rather than financial institutions – who face taking losses. Depending on how the recapitalisation is structured, bond holders might be able to avoid these losses.