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Uncle Sam: Not a good investor

I'm not sure how telling it is, but the Daily Beast has done an interesting analysis of how the largest federal investments in private companies have done over the past six months. 

The verdict: Not so hot.

Actually, kind of crappy.

Says The Beast:

In fairness, it's not like these guys were tasked with being the best money managers they could be. Instead, they were tasked with saving the system.

Sadly, though, it looks like the judgment of the market is that some of the companies they thought worthy our largesse were destined for the scrap heap in any event.

Let’s break it down. If you look at infusions of taxpayer money of $5 billion or more since last October, you will find that, on balance, Uncle Sam is a terrible investor. That’s a total of $268.1 billion invested.

As of Friday’s close, our portfolio was worth just $202.4 billion. We’re out almost $66 billion in six months. On an annualized basis, that’s a 32.2 percent loss. Putting all that money into a plain-vanilla S&P 500 index fund would have lost us just 4.4 percent during that time.

Elsewhere on the bailout front, New York Times columnist Paul Krugman has emerged as a leading critic to the federal approach. He started when Dubya was still in office and hasn't eased up on Obama. Check out Krugman's blog


Economic bailout
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