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What? A bank that can operate on its own? I didn't think we'd ever see the day.
Goldman Sachs's (NYSE: GS ) CFO announced that the firm wants to repay all $10 billion of the TARP funds injected last October, saying that "Operating our business without the government capital would be an easier thing to do … We'd be under less scrutiny and under less pressure. "
Well, yeah. One thing's clear: Public anger is increasingly calling the shots at these big banks … as it probably should. Outrage erupted after Bank of America's (NYSE: BAC ) Merrill Lynch rushed its bonuses out in December, Citigroup (NYSE: C ) tried to push through a new private jet, and news leaked of a viva Las Vegas getaway for Wells Fargo (NYSE: WFC ) . (The latter two plans were eventually scrapped.)
If Goldman doesn't need the money, why not pay it back? Holding bailout funds you don't need is like confessing to a crime you never committed. Goldman isn't completely innocent – the shareholders down 50% in the past year can attest to that -- but it's certainly in vastly better shape than its peers, as verified by Berkshire Hathaway's (NYSE: BRK-B ) vote of confidence last fall.
It's nice to see at least one company acknowledging the downside of taxpayer aid. Bailouts shouldn't be a boon that relatively healthy companies eagerly exploit. They should be onerous and demanding, with every penny of expenses scrutinized while they're held.
One nugget from yesterday's executive compensation curbs riled me: Only firms granted "exceptional assistance" will be reined in. Shouldn't any government help qualify as exceptional assistance? We should all hope so.
I'll be interested to see whether other less-than-bankrupt firms follow Goldman's lead. I'm not holding my breath, but who knows? Maybe this is a hopeful sign of things to come.
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