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Dear Mr. Berko: Several of us would like to know how much government money was given to financial companies, manufacturers and people. When we add up the numbers, the sum is only a small portion of the $800 billion the government has given out. Can you give us a complete list of all the recipients? We鈥檝e written two congressmen, but they won鈥檛 give us a straight answer. Perhaps these people should be limited to one term in office.
And what do you think of General Electric? I bought 150 shares when Mr. Buffett lent GE money and received options on 135 million shares. It seems Mr. Buffett may lose a lot of money because the shares have really fallen from $22 since then. Some of us think if GE was good enough at $22 for Mr. Buffett, it should be even better for us at this price. — E.P., Paducah, Ky.

Dear E.P.: A year ago, we were staring in the face of a banking scandal/collapse that, if left untended, would have made the Great Depression mere child鈥檚 play. Aided and abetted by venal greed, large brokerages, the big banks and mega insurers played a 鈥渟corched-earth鈥� game with trillions of dollars of public money.

The American taxpayer took it in the gut while insurance executives, brokerages and bankers were cumulatively paid hundreds of billions of dollars in bonuses and salaries. The public is aware of this.

But the public is not aware that 32 hedge-fund managers, each of whom earned more than $500 billion, and myriad lesser-paid executives who earned only a few hundred million dollars, paid taxes on only 15 percent of their earnings. When these fellows contributed huge sums to various congressional causes, Congress showed appreciation and passed a very special ruling that taxed those earnings at 15 percent. So perhaps we need to limit our politicians to just two terms: one in office and one in jail.

So, the Federal Reserve created about $700 billion in stimulus money during the past dozen months to rescue the economy and small businesses. And try as I did, I was unable to obtain an itemized list of banks, insurance companies, manufacturers and individuals that benefited from the greatest giveaway in the modern world. I also would like to know where our money went, but we may not have the right to know.

One member of Congress who has occasionally opened closed doors for me suggested that if the list of recipients were made public, that 鈥渟tain would be disruptive and indelible.鈥� Yet, as taxpayers, who are involuntary investors, we have a right to know who received our money, why the loans were made, in what amounts and for what collateral. However, Congress tells us that we do not have the right to know this because it would 鈥渟tigmatize and frighten鈥� the taxpayer. So if you guys want to know who received your tax dollars and how much, consider employing a lawyer to request this information under the Freedom of Information Act. I suggested this as an alternative and was told that the administration would refuse to release that information and cite 鈥渄anger to national security.鈥� Wow.

And yes, I鈥檇 be a buyer of General Electric (GE 鈥� $16), which is way under Warren Buffett鈥檚 warrant price of $22.25. GE, at this price, should be in every long-term growth portfolio, and I think it could easily double and nicely increase its dividend in the next five to seven years. Mr. Buffett has four years remaining to exercise his option on 135 million GE shares. It was late September 2008 when Mr. Buffett loaned GE $3 billion at 10 percent and received a five-year warrant to purchase GE. But don鈥檛 cry in your beer for the guy. Just a few days earlier, Mr. Buffett lent Goldman Sachs (GS 鈥� $165.09) $5 billion at 10 percent for five years and got warrants to buy 44 million shares of the firm at $115.

Address your financial questions to Malcolm Berko, c/o The Daily Journal of Commerce, P.O. Box 8303, Largo, FL 33775, or e-mail him at [email protected]. 漏 2009 Creators.com