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Joe's Cafe, 24/7 pit stop for ESL learners and teachers | October 2008
Egg's off, bacon's off, bread's off, tea's off. English is on though.

When is an asset a “troubled asset”?

If you haven’t yet heard about TARP, you probably will do any day soon. TARP is the US government’s “Troubled Asset Relief Program”—a $700,000,000,000 slush fund for Hank and Co. to bail out their buddies on Wall Street and throughout the US banking sector. It’s not just in the USA that this kind of organized crime has taken root. It’s all the rage from London to Sydney too. But what is particularly striking about Hank’s little plan is the clever title he gave it, incorporating the term “troubled asset”. In my absolute ignorance, I always thought that a troubled asset was a liability.

  • asset (noun): a thing owned by a person or company, considered as having value and which can be used to pay debts
  • liability (noun): a thing for which a person or company is responsible, especially a debt or financial obligation

“When words lose their meaning, people lose their freedom.” - Confucius

Joe | Monday, October 20th, 2008 | Filed under Vocabulary

3 Responses to “When is an asset a “troubled asset”?”

  1. THU DOAN says:

    Dear joe,
    Can you explan ‘troubled asset’ and TARP for me? I’m really in complete ignorance of economic policy and economic definition.

  2. Joe says:

    Thu Doan: An “asset” is something valuable that you possess. For example, if you have $1,000,000 in the bank, that is an asset (for you). It is not an asset for the bank. It is a “liability” for the bank because they don’t own it; they have to give it to you when you ask for it. If you buy a car on credit, and you have to pay $100 every month for the car, then the car is not an asset for you. It is a liability.

    “Troubled” means that something has a problem. Assets are good. They don’t have problems. Liabilities are bad. They have problems. The US government is talking nonsense by using the words “troubled” and “assets” together. They are trying to deceive people by making the situation look less bad than it really is.

    There is nothing unusual in this. Many governments use language to deceive people. Only the US government is one of the most accomplished at doing so. In other regimes it might be called propaganda.

    “When words lose their meaning, people lose their freedom.” - Confucius

  3. Anushka says:

    At first I didn’t get it, but when you explained it again, now it’s OK.
    Thank you…THU DOAN for asking it again..

    and thank you Joe!!

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