Troubled Asset Relief Program (TARP)
The Troubled Asset Relief Program (TARP) was a government program created in 2008 to help stabilize the U.S. financial system during the global financial crisis. The program was authorized by the Emergency Economic Stabilization Act of 2008 and was administered by the U.S. Department of the Treasury. TARP was designed to purchase troubled assets from financial institutions in order to restore liquidity and stability to the financial system. The program was initially authorized to purchase up to $700 billion in assets, but the amount was later reduced to $475 billion.
History of TARP
TARP was created in response to the global financial crisis of 2008, which was caused by a combination of factors, including the bursting of the housing bubble, the collapse of the subprime mortgage market, and the failure of several large financial institutions. The program was intended to provide financial assistance to banks and other financial institutions in order to stabilize the financial system and prevent a further economic downturn. The program was initially authorized to purchase up to $700 billion in assets, but the amount was later reduced to $475 billion.
Comparison of TARP and Other Programs
Program | Amount |
---|---|
TARP | $475 billion |
CARES Act | $2.2 trillion |
PPP | $659 billion |
Summary
The Troubled Asset Relief Program (TARP) was a government program created in 2008 to help stabilize the U.S. financial system during the global financial crisis. The program was authorized by the Emergency Economic Stabilization Act of 2008 and was administered by the U.S. Department of the Treasury. TARP was designed to purchase troubled assets from financial institutions in order to restore liquidity and stability to the financial system. The program was initially authorized to purchase up to $700 billion in assets, but the amount was later reduced to $475 billion. For more information about TARP, visit the U.S. Department of the Treasury website or the Federal Reserve website.
See Also
- Emergency Economic Stabilization Act of 2008
- Financial Crisis of 2008
- Housing Bubble
- Subprime Mortgage Market
- CARES Act
- PPP
- Federal Reserve
- U.S. Department of the Treasury
- Liquidity
- Stability