Out Fox The $treet

And that assumes the cost won't continue to drop. The Trouble Asset Relief Program (TARP) continues to be scorned by most people costing many backers their political positions, but ironically it has turned into one of the most successful government programs ever. Ok, its very possible that the politicians lost their jobs due to the numerous other packages enacted after TARP that weren't nearly as successful. Anybody hear of any benefits from the stimulus package? Today the Congressional Budget Office (CBO) estimated that the $700B TARP program would only end up costing taxpayers $25B an absurdly low number considering the consternation when it was enacted. Back then lots of focus was on the $700B being a taxpayer cost instead of an investment in the financial system that was about to collapse. In fact, it would've been a lot more successful if the focus hadn't strayed to the weak companies like General Motors (GM) and AIG. Somebody explain to me how GM is back publ...

Just minutes ago, Hartford Financial announced that they has repaid the US Treasury the $3.4B that HIG had borrowed during the crisis. With this out of the way, the stock price should now be free to breakout above the current range. Looking at the chart $28.50 has been strong resistance so any solid break and close above it would signal a higher range going forward. The Hartford paid $3.4 billion to the U.S. Treasury to repurchase the preferred stock, plus a final dividend payment of about $21.7 million. The Hartford funded the repurchase with proceeds from its recent equity and debt offerings, as well as from available resources. The U.S. Treasury continues to hold warrants to purchase approximately 52 million shares of The Hartford’s common stock at an initial exercise price of $9.79 per share. The company does not intend to repurchase the warrants from the U.S. Treasury.

After the close Hartford Financial (HIG) announces plans to repay TARP. They owe $3.4B so they've chosen to do a combination of equity and debt financing. Considering the equity portion is only $1.45B this appears bullish to us. The offerings announced today will consist of $1.45 billion of common stock and $500 million of mandatory convertible preferred stock, represented by depositary shares. The debt offering related to the repurchase of the government's preferred stock will consist of $425 million of senior notes. In addition, the company will pre-fund the repurchase of its senior debt maturing in 2010 and 2011 through the issuance of an additional $675 million of senior notes. Considering how cheap HIG is compared to book value and EPS, this move could finally unlock that value as shareholders have been hesitant to load up with TARP hanging over them. HIG is one of the largest investments in our Growth and Opportunistic Portfolios...