The Real AIG Scandal - Spitzer: The transfer of $12.9 billion from AIG to Goldman looks fishier and

[malaise]

fishier

http://www.slate.com/id/2214407/?from=rss
<snip>
The AIG scandal is getting ever-more disturbing. Goldman Sachs' public conference call explaining its trading relationship and exposure with AIG established once again that Goldman knows how to protect itself. According to Goldman, even if AIG had failed, Goldman's losses would have been minimal.

How did Goldman protect itself? Sensing AIG's weakening capital position through 2006 and 2007, Goldman demanded more collateral from AIG and covered outstanding risk with instruments from other firms.

But this raises two critical questions. The first is why did $12.9 billion of taxpayer money go from AIG to Goldman? What risk—systemic or otherwise—was being covered? If Goldman wasn't going to suffer severe losses, why are taxpayers paying them off at 100 cents on the dollar? As I wrote earlier in the week, the real AIG scandal is that the company's trading partners are getting fully paid rather than taking a haircut.

[annabanana]

1. What's the relationship between Goldman, JPMorgan & the Fed?

There seems to be a kind of nexus.. or am I just crosseyed?

[malaise]

3. At times like these I think we all should get back to

books like Parenti's Democracy for the Few.

[izquierdista]

4. Hank Paulson

He would be the puppetmaster holding the strings to all three.

[malaise]

12. Ding ding

we have a winner

[Sebastian Doyle]

5. It's the REAL "Axis of Evil"

nevermind that fictional bullshit Chimpy made up.

[Sebastian Doyle]

2. It's time to make an example out of these treasonous Goldman Sachs fucks.

Line em up against the wall and do what the law prescribes for treason.

And yes, you bet your ass I'm serious. :grr:

[Richard Steele]

6. K&R

[Warren Stupidity]

7. I'll go out on a limb: Spitzer victim of Honeypot sting to take him out

before the financial collapse. Fortunately for me it is a huge and sturdy limb on a very solid tree.

[LooseWilly]

10. I like conspiracy theories that make so much sense.

Now I have another lens to examine the news through... of course, the next question would be: What powers would Spitzer have had over events if he were still NY governor?

[malaise]

14. I agree 100%

Check this thread
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x5291843

Read the breakfast link. Nice synopsis.

[truedelphi]

41. Monsanto has wanted him gone for over a decade.

He is one of the few elected civil servants that understands the diabolical nature of almost everything Monsanto does.

Activists like myself were amazed when, as AG for New York State, he had Monsanto pay
$ 50K for their misleading ads about RoundUp's safety.

And now that Monsanto wants a lot fo GMO every where all the time, a noose had to be put around his neck.

Even if Spitzer knew absolutely nothing about the economic tsunami and the guilt or fraud of those major players, he has been on a hit list for a long time. And I think most of us believe that he knows a lot about the guilt and fraud of the big time players.

[leftstreet]

8. "Who signed off on this ($200) billion bailout...and why?"

Heads.
Pikes.

[spanone]

9. knr

jeeeez

[inna]

11. i really think the $200 million AIG bonus scandal is nothing but a distraction....

... from the *real* scandal.

rec'd.

[Last Stand]

24. I'm with you. Never trust the cover story. nt

[JDPriestly]

36. The bonus scandal is a symbol for the rest of it.

The "real" scandal is the power of Wall Street.

The "real" scandal was the Bush tax cuts, the S.C. decision that let the interest rates banks could charge skyrocket and shifted the focus of our economy from producing goods to trading money and credit. The "real" scandal is the extreme difference between the incomes of the poor and the middle class versus the wealthy elite.

The whole bail-out is just a symptom of these underlying wounds to our society.

We are bruised and bleeding, and the bonuses scandal reminds us of our injuries.

[grasswire]

39. yes, it is akin to the "16 words" frame

It's called a "limited hangout" in political parlance.

[scarletwoman]

13. Aaaggghhh! Between this & the Tiabbi article (link posted below) I just want to curl into a ball

and never read news articles or watch TV news again. Ever. I'm going to give away my computer, grow a garden, and live out my life quietly and anonmymously on my little 10 acres in blissful ignorance until the New World Order black helicoptors come to haul me away to process my aging carcass into Soylent Green.

Matt Tiabbi article: The Big Takeover: How Wall Street Insiders are Using the Bailout to Stage a Revolution

There's just too much evil in this world. :cry:

sw

[malaise]

16. The last gasp of the Bush 2000 coup

That's exactly what happened. They will not succeed.

[TahitiNut]

18. You've gotta admit, it was the biggest "October Surprise" of all time.

Cheney/Bush destroyed EVERYTHING they touched ... and more.

[malaise]

23. Absolutely correct

The thing is there were DUers who knew what was happening.

[TahitiNut]

17. But you've gotta love Taibbi's use of language.

AIG is what happens when short, bald managers of otherwise boring financial bureaucracies start seeing Brad Pitt in the mirror. This is a company that built a giant fortune across more than a century by betting on safety-conscious policyholders - people who wear seat belts and build houses on high ground - and then blew it all in a year or two by turning their entire balance sheet over to a guy who acted like making huge bets with other people's money would make his dick bigger.

That's actually a very good article. Taibbi describes the scam quite well, imho.

[leftchick]

27. fetal positions everyone

cuz it really, finally appears that we are fucked. There is no future for my boys except corporate slavery. :cry:

[TacticalPeek]

15. I think Eliot Spitzer smells a big, fat commie rat.

ZAKARIA: So, do you think that the problems that AIG got into later on stem from some of the same practices that you were trying to get at?

SPITZER: They stemmed from an effort from the very top to gin up returns whenever, wherever possible, and to push the boundaries in a way that would garner returns almost regardless of risk. . . . Back then I said to people, AIG is at the center of the web. The financial tentacles of this company stretched to every major investment bank. The web between AIG and Goldman Sachs is something that should be pursued.

And as I have written...

ZAKARIA: Meaning what? Meaning that a lot of the money that we the taxpayers gave AIG has ended up being paid to Goldman Sachs...

SPITZER: Precisely. And...

ZAKARIA: ... and other companies.

SPITZER: The so-called counterparties to these very sophisticated financial transactions.

http://transcripts.cnn.com/TRANSCRIPTS/0903/22/fzgps.01.html

[JDPriestly]

37. We need to find out who lead the naked shortselling that brought

down Lehman and Bear Stearns. I suspect that all roads lead to the same culprits. But I have no evidence, and I am not in a position to gather it.

[No.23]

19. If you're gonna follow AIG's money, you really need to begin here:

http://www.opensecrets.org/orgs/toprecips.php?id=D000000123

That's where the money trail REALLY begins.

[xiamiam]

21. thanks for this...i like the way a lot of the players are neatly organized...a very good starting

point...as individuals they are up for scrutiny..and they brought it on themselves...i for one never really cared about these guy, but now that they have utterly destroyed my life and millions of us and more to come..probably the entire middle class...i would like to see them held accountable for the heist to beat all heists...

[malaise]

22. You're correct

I've checked it before.

[katty]

35. yup

[McCamy Taylor]

20. Did AIG pay Carlyle $16 billion to cover their losses? That is what I want to know.

[leftchick]

25. I watched him on cnn yesterday

damn that guy is sharp as a tack! I could barely keep up with him. He is a freakin genius! No wonder they went after him.


the last line is so true, I wish obama would take some serious advice like this...

<snip>

It is time the government realizes it has two simple options: tightly regulate entities that are too big to fail, or break them up so they aren't.

[malaise]

26. He was great on CNN yesterday

I hope we see a lot of him on KO, Rachel and Bill Moyers.

Fareed Zakaria is CNN's only hope.

[ShortnFiery]

28. It's absolutely TRAGIC that a man as gifted as Spitzer couldn't keep his hormones in check.

Much the of the same perspectives that I hold for Bill Clinton: Brilliant men: But hoist on their own petards due to their unbridled ARROGANCE. :(

[OmmmSweetOmmm]

29. The tragedy is that the US is too provencial to let go of his indiscretion. We need him now in an

official capacity. If what he did happened in France, no one would have blinked an eye.

[malaise]

43. No one in the GOP blinked an eye over Vitter or Craig

Welcome back Eliot Spitzer.

[antimatter98]

30. I'm thinking AIG was 'the' money launderer for CIA, NSA ops, etc..and a covert war funder.

I think AIG is a major money launderer for a variety of covert, black
ops and budgets world wide, not just for US agencies and wars.

The company was founded in Shanghai in the early 1900's and had a ton of
information about the infrastructure of Japan and China that came in
handy during WWII. In Europe, parenthetically, Germany's insurance groups,
operating all over Europe, had similar detailed information, which came
in handy when Hitler launched the war.

The AIG bonuses are trivial, but do stand out for the arrogance of the
bailout recipients. But AIG is a hub entity, and how their money is spent
and obtained is of the most importance.

We're seeing this hidden world suddenly emerge, and I hope a few in journalism
help us to further define what exactly this 'American economy' and banking
system is up to and has been up to. Did profits on derivatives and CDO's
fund wars and black budgets? Is this why AIG is taking all the government's
attention and money right now?

[Demeter]

31. that Would Explain Their Business Plan and Party Attitude

[defendandprotect]

32. Keep moving this thread up !!!

[Raksha]

33. K & R

[katty]

34. for futher inquiries: Contact Hank Paulson

[jaycal]

38. The Real Scandal and Why Obama won't do anything about it

The issue of bonuses is a diversion. The amount is "only" $165 million, less than one-thousandth of what was paid to AIG counter-parties (including Goldman and foreign banks).

If you want to know how much influence Goldman has over the government, you can read: http://www.baltimoresun.com/news/opinion/oped/bal-op.smith20mar20,0,5158027.column or http://www.rollingstone.com/politics/story/26793903/the_big_takeover/print

It is funny that politicians (including Obama) have lined up to denounce AIG but hardly anyone mentions Goldman.

As this article http://thebulletin.us/articles/2009/03/10/top_stories/doc49b61e46e935b133022700.txt notes, Obama got $1 million from Goldman which got back $6 billion. Apparently Obama got 4 times as much from Goldman compared to McCain.

As Bob Ostertag writes about Obama's fund-raising "Just think through the basics: if on one side you have over a million people giving you little donations that make up 45% of your budget, and on the other side you have a handful of people giving you big donations that make up 55% of your budget, whose telephone calls are you going to take?"

My theory is that Bush was so bad, that people lost sight of what McCain actually was. And add to that the media's love affair with the "Obama story".

Paulson (ex-CEO of Goldman) sits in a meeting that includes Blankfein (current CEO of Goldman) the Sept 13 weekend when the government was bailing out AIG (led by Liddy, a former director of Goldman installed as AIG CEO by Paulson) which leads to Goldman getting $13 billion.

Also Geithner is a Rubin (a third ex-Goldman CEO) protege. His top aide is a former Goldman lobbyist.

AIG's financial products division is the low hanging fruit, which the politicians can beat up for their publicity. The employees there simply don't have the kind of connections Goldman has.

This is really become a "bipartisan kleptocracy". Bush was the
original "Nightmare". Obama is "Nightmare, the Sequel".

[aldo]

40. Spitzer for Treasury Secretary

or at least advisor with maybe Robert Kuttner for Treasury Secretary. Geithner is part of the problem (as is Summers).

[BrklynLiberal]

42. Reading articles like this shows you why Spitzer was targeted.

[redqueen]

44. Kick because the bonus madness is a distraction...

:kick: