The Fed's fast-tracking of TARP money as tier 1 capital - that is, the money valued at 100% of its face value, basically, for capital adequacy purposes - was finalized today. Not too surprising, not really that controversial: government money is good money. There's a tiny bit of a larger robbing Peter to pay Paul element to all this, though. What the Fed did means that TARP money - a state program - has been given to ensure that banks can meet their Fed/Basel regulatory requirements - which is also a state program. Some might call that going through the looking glass, but I call it more proof that we live under a big and complex government.
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