
Remember when the United States government took a bunch of your money and bought crap securities from Bear Stearns and
American International Group (NYSE:
AIG) -- and promised we wouldn't lose money? The securities were temporarily undervalued because of an "illiquid marketplace" and we'd earn handsome returns.
Ah, yeah. About that.
The Associated Press reports that "
The Federal Reserve lost $5.25 billion in the first quarter on the securities it acquired with last year's bailouts of
Bear Stearns and insurer
American International Group, according to a report Wednesday. The loss on the holdings, which include mortgage-backed securities, reflected a decline in their value as the recession carried over into the first three months of this year. The cumulative loss on the Bear and AIG holdings comes to $16.46 billion since they were taken over last year."