By MATT JAFFE, ABC News
More and more of the nation’s banks are starting to pay back billions in government bailout aid, a move analysts warn might seem to be a sign of strength, but could ratchet up pressure on other banks to follow suit and result in some institutions prematurely getting out of the government program…
Former Treasury Secretary Paul O’Neill noted that at the start of the TARP program, the heads of the major U.S. banks were summoned to Washington and told they were required to take the money so that those who needed it would not be stigmatized.
"So they all took the money. Stop and think about that. What was the purpose of this policy? To deceive the people so that the public would not know which banks were in danger of failing? Why didn’t any of the CEO’s, claiming not to need the money, have the courage to refuse?" O’Neill said in an e-mail to ABC News. "If banks now claim they want to return the money because they don’t need it, why do they have to raise new capital to replace the money from we the people in order to repay the government?"
O’Neill said that unfortunately the government is permitted to practice a policy of deception for the greater good of the society…
To calm investors the Obama administration now looks like it will be forced to release information about the health of 19 of the country’s largest banks that it gathered as part of its "stress test" process, The New York Times reported this morning.
All attention on Wall Street though is likely next to turn to JP Morgan Chase for the release of its first-quarter earnings report tomorrow…
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