Not that those banks have been particularly forthright about where the money’s going if not toward lending. In December, The Associated Press asked the 21 top TARP recipients to specify how they’re using the funds. The AP reported Tuesday: “None would provide any specifics.”

The fact is, the banks' balance sheets were a lot worse than they let on. They couldn't lend any more money or they'd have to admit they were insolvent from carrying too many toxic assets on their books. So they just hoarded it instead and hoped no-one would notice. Geitner and the people at the Fed and Treasury recognized this, which is why we're on to Phase II: simply taking them over and unwinding their (mostly worthless) assets in an orderly, bankruptcy-like fashion.