You heard me right…that’s your hard earned tax dollars at work. Here’s a clip from Bloomberg:
“Bank of America Corp.’s $3 billion takeover of Countrywide Financial Corp. will be financed by 138 million tax-paying Americans.
Bank of America, led by Chief Executive Officer Kenneth Lewis, can use tax write-offs to pay for Countrywide, the country’s biggest mortgage lender, said Robert Willins, a former managing director at Lehman Brothers Holdings Inc. who now runs his own accounting firm. Taxpayers may pick up about $5 billion of Countrywide’s losses over 20 years, he said. Countrywide shareholders approved the sale today.”
Check out the full article, “Bank of America’s Countrywide Tab Signed by Taxpayers.”
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So, the question that comes to mind is whether we would pay more by letting the banking fallout take it’s true course without government (tax money) intervention.
The kind of deals that big businesses work out just amaze me. I want to meet the man behind that negotiation.
Deals like this just erk me. It seems like more and more expenses or investments can be deemed a “tax write off.” Sure they could be saving us in the future by “saving the industry”, but will we see the profits when the industry turns around?