THEY KNEW! - AIG was a Ponzi scheme plain and simple

[kpete]

They knew: http://www.ritholtz.com/blog/2009/04/aig-before-cds-there-was-reinsurance/

"In fact, our investigation suggests that by the time AIG had entered the CDS fray in a serious way more than five years ago, the firm was already doomed. No longer able to prop up its earnings using reinsurance because of growing scrutiny from state insurance regulators and federal law enforcement agencies, AIG’s foray into CDS was really the grand finale. AIG was a Ponzi scheme plain and simple, yet the Obama Administration still thinks of AIG as a real company that simply took excessive risks. No, to us what the fraud Bernard Madoff is to individual investors, AIG is to the global financial community.

"As with the phony reinsurance contracts that AIG and other insurers wrote for decades, when AIG wrote hundreds of billions of dollars in CDS contracts, neither AIG nor the counterparties believed that the CDS would ever be paid. Indeed, one source with personal knowledge of the matter suggests that there may be emails and actual side letters between AIG and its counterparties that could prove conclusively that AIG never intended to pay out on any of its CDS contracts.

"...These were not valid contracts as Fed Chairman Ben Bernanke, Treasury Secretary Geithner and Economic policy guru Larry Summers claim, but rather acts of criminal fraud meant to manipulate the capital positions and earnings of financial companies around the world.

"...Seen in this context, the payments made to AIG by the Fed and Treasury, which were then passed-through to dealers such as Goldman Sachs (NYSE:GS), can only be viewed as an illegal taking that must be reversed once the US Trustee for the Federal Bankruptcy Court for the Southern District of New York is in control of AIG’s operations."

much more at:
http://us1.institutionalriskanalytics.com/pub/IRAstory.asp?tag=351

[dipsydoodle]

1. Hardly suprises me

but good to be confirmed.

[marketcrazy1]

2. of course they knew

to bad this will get NO TRACTION AT ALL and no action will be taken to address this FRAUD!!

[CAcyclist]

43. They are being investigated, though. nt

[truedelphi]

48. Well praise be.

But it's certainly a lot too late. And a lot too little that will come out of the investigations.

Ms Warren, who heads up an oversight committee to oversee the BailOut Funds, does not get her questions answered by anyone of importance in the financial herd. Geithner cannot be bothered, nor Bernanke, nor Liddy (He heads AIG.) Senators that took time to meet with her Tuesday reported having the same experiences.

So we will see if David can kill Goliath, but I am afraid that as long as Obama is under the voodoo spell of Geithner, Summers, Rubin and Gensler, not much will be different for the working class, except a heavier burden to carry.

[girl gone mad]

46. I'm going to put this here, so it will be at the top.

Cuomo is going to need our support in going after these guys.

I've already seen a few attacks on him posted. They want to say that he's only in it to advance his career. Oh well. He may be the only politician who has something to gain by getting to the bottom of this. We have something to gain, too, and we need to keep that in mind.

[chill_wind]

50. Roger that. n/t

[aquart]

3. Reverse those illegal takings now.

And start criminal proceedings against those bastards.

Seize their houses. Seize their underwear. Take it all back.

[dipsydoodle]

12. Thee is in reality

nothing to prevent an order to unwind each and every contract back to day 1.

Just needs someone with the balls to do so.

[southerncrone]

56. Absolutely.

The Treasury Dept. should immediately freeze ALL of the top 2 levels of mgt's accounts & seize ALL of their assets. This is for all of the companies that indulged in the operations that destroyed our economy. This includes wives & children's assets, too.

There is no justice in this country if this does not happen.

[Octafish]

4. DU knew, too.

And we tried to warn everybody. No one who could do anything about it listened because there's too much money in play.

Know your BFEE: Goldmine Sacked or The Best Way to Rob a Bank Is to Own One

Sad to write that it's looking more and more like they're getting away with it.

Know your BFEE: Phil Gramm, the Meyer Lansky of the War Party, Set-Up the Biggest Bank Heist Ever.

Oh, well. We can all talk about it 'round the fire, someday, how We the People paid for the overlords' Swiss mountain redoubts.

[BeFree]

9. They did it again, eh?

Give 'em credit, they sure do know how to shear the sheep.

And there sure are a lot of nekkid sheep 'round these parts.

[sabrina 1]

13. Octafish, I just read

your Phil Gramm post. Excellent work putting it all together. This should be on the news and repeated as often as they repeat the hourly shenanigans of Britney Spears. So why isn't it?

Phil Gramm is definitely at the top of the list of those who contributed to this crime, yet he's hardly ever mentioned.

I'm beginning to think, watching how it's being handled, that all they are doing is trying to salvage the mess they made and in the end, keep the same system going and that too many Dems are just as interested in doing that as the Repubs are.

And yes, as you asked in that post, 'where is the money'? It didn't just disappear! And is anyone looking for it?

I would be satisfied to see all those who created this mess forced to return every dime from whatever off-shore banks they are hiding it in, and live the rest of their miserable lives the same way everyone else does, working for a living. And I know, that is being way too kind, but to them, it probably would be hell on earth.

[JDPriestly]

25. It's going to be fun watching the rich scramble to get their money

safely from the old tax havens that will now be on the blacklist into some new scam that prevents them from having to pay taxes like the "little people." We should keep a particularly sharp eye on the travels of Senator and Ms. Gramm.

A lot of heads will role in Congress if their use of tax haven accounts is actually made public.

[sabrina 1]

27. Good idea, keeping an eye on the Gramms

I wonder if he's still upset about the 'whining' of the working class?

All of those who use tax haven accounts in foreign countries should be exposed. If we only had a few real investigative journalists left in this country. I've read that a lot of them started up fake businesses in some of these countries, which have no staff or even offices, in order to qualify for the use of their tax havens. All that needs to be exposed and all the revenue they've dishonestly 'saved' ought to be retrieved.

[FiveGoodMen]

28. "'where is the money'? It didn't just disappear!" -- I'm with you there!

We still have oil.

We still have available workers.

We still have farmland.

We still have everything it took to run the economy back when it was working.

Only the money is gone.

We should get it back.

[flyarm]

19. yes some knew..but many here chose not to look or like to smear those who have looked

and try to report the truth!

But But But ..we can't look at truth..that is verboten..per the cheerleaders around here!

[seemunkee]

5. First link is not working

[stillcool]

8. I got there..

but I had to look around a bit..try this:
http://www.ritholtz.com/blog/2009/04/aig-before-cds-there-was-reinsurance/

[Demeter]

6. I am blatantly stealing this to crosspost in SMW

Thanks, kpete!

[stillcool]

7. Another one of those articles..

that require serious concentration for comprehension. Thank You! I'm going to add it to my list of must reads homework.
http://www.ritholtz.com/blog/2009/04/aig-before-cds-there-was-reinsurance/

[KittyWampus]

10. which is why I am furious with Obama's Administration. ZERO accountability.

[Brucie Kibbutz]

39. What are you so worried about?

:eyes:

[Romis]

63. Yep - "I got this" alright

Wake Up! Bush only paved the way........................
http://www.obamadeception.net/
http://learnonline.wordpress.com/2009/03/21/the-obama-deception/
etc., etc.
http://www.google.com/search?q=The+obama+deception&ie=utf-8&oe=utf-8&aq=t&rls=org.mozilla:en-US:official&client=firefox-a

[crikkett]

72. Oh Jumpin Jehosophat.

Go away. "The Obama Deception" is bad conclusions from bad fact.

[SammyWinstonJack]

64. Sure he does.

:spray:

[Last Stand]

11. This has been my description of this mess all along.

This may be the first time I scooped kpete. http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=389&topic_id=5376183&mesg_id=5376445

The bonus scandal is just a smoke screen. Pay no attention to the men behind the Enronian Accounting.

[earth mom]

14. And the Obama administration is propping this shit up!

Wake up and smell the corruption DU and America!!! :argh:

[flyarm]

18. SHHHHHHH..BUT BUT BUT ..IT'S ONLY BEEN ..HOW MANY DAYS????

SHHHH.. remember we heard the same shit in 2000 over Bushy boy!!

Shhhhh..you will awaken the excusers!!

and who is this administration working with??

Kissinger

Geithner..who worked for Kissinger and the CFR

Geithner..who's papa Peter F.Geithner was with the Ford Foundation and Obama's mom just happened to work with him!!

Any wonder why the GM CEO was made to step down..the very day that Ford announced it was opening a plant in Mexico..the znnouncement took place at the Pres of Mexico's palace..and do not miss the very fact that the CEO of Ford said : Mr Mullaly said: "We are convinced the geographic location as well as Mexico's highly qualified labour force and economic stability make this decision the right one for our business."

That would be 4,500 jobs Americans will not get!!


http://news.bbc.co.uk/2/hi/americas/7428952.stm


psssssssss..look over here.......


Peter F. Geithner, is the director of the Asia program at the Ford Foundation in New York. During the early 1980s, Peter Geithner oversaw the Ford Foundation's microfinance programs in Indonesia being developed by S. Ann Dunham-Soetoro, President Barack Obama's mother, and they met in person at least once

Geithner's maternal grandfather, Charles F. Moore, was an adviser to President Dwight D. Eisenhower and served as a vice president of Ford Motor Company.

[earth mom]

21. Thank you for connecting the dots. It's crucial now more than ever.

:thumbsup:

[Holly_Hobby]

44. This is the second time I've seen you post this information

Please keep posting it. They'll get it sooner or later. :thumbsup:

[flyarm]

49. I will!! because I am mad as hell! I see so many seniors here in Fl who are suffering because of

this ..it is a disgrace.

Many have to chose between food and meds..

and seniors have been being knocked over in grocery parking lots and having their goceries or purses stolen..people are suffering big time..and yet the same shadow government is still in place!

Just a disgrace..and there are people working overtime to keep the info silent!

I will not be silenced!

[acmavm]

59. No they won't. You give them too much credit.

[SammyWinstonJack]

66. "They'll get it sooner or later." Doubtful, very doubtful.

[chill_wind]

23. Someone presumably not high on the AIG list of campaign $ beneficiaries is asking

How Hard the Fed Looked for AIG’s Potential Losses

Before you handed over $85 billion to a failing company, what sort of information would you need to know about it?

(...)

So what information did they have? And what information have they used in the following six months, which saw three additional bailouts, each one prompted by apparent realizations that the situation was even worse than was known before?

Rep. Elijah E. Cummings (D-MD) wrote to both the Fed and Treasury in late January, asking essentially the same questions about what information the government used to justify its AIG rescue, which has grown to a commitment of up to $180 billion.

The Treasury -- which has the most money on the line when it comes to AIG -- has not yet responded to Cummings' request. No one at the hearing asked Treasury Secretary Tim Geithner, who was head of the New York Fed when the initial decisions were made, to provide Treasury's set of numbers.

(more)

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=114x61719

This may take a while yet. We've already talked about who AIG has given the bulk of its campaign money to.


Spitzer on AIG: I told you so.

[FiveGoodMen]

29. Looks more like it every day.

In which case we're totally screwed.

[SammyWinstonJack]

65. Real stinky isn't it?

[sutz12]

15. It was no coincidence of timing when Shrub went on tour to privatize SS...

They were looking for a cash infusion back then, knowing the bubble was about to pop.

:shrug:

[progressoid]

17. eh - we gave them the money anyway didn't we?

[flyarm]

68. and who did Bush try to sell that bullshit to?? the youth of this country

I remember vividly going round and round here on Du and many other blogs with young people about the SS bullshit they were trying to sell the American people..again to be slimed and called names..

Somethings never change..how can they?? They stopped teaching civics in our schools for a reason..so they could sell more and more bullshit and propaganda to the youth of this nation, so they can control those with little knowledge of the history of what was fought for by our predecessors and forefathers!

This way they can rally the youth with promises of bullshit..code words, and give them ipods and send them off to bash anyone who questions what is really going on!!

Oh those arms..oh I am soooooooooo proud bullshit..they can hire the kids cheap..send them off to the internet, and try to stop all inteligent conversation and discourse.

How many here know about Kissinger that is under 30?

Well prior to now..mention Kissinger to any democrat i know..and fire would come to their eyes!!..

But here shortly after Obama took office he sent Kissinger to Russia to represent this administration, and who then was one of the first people Obama met at the G20?? Russia's pres..

Why would Obama send Kissinger to Russia..the same Kissinger that was tied directly to Nixon, Ford,Reagan and Pappy Bush..the same Kissinger that worked extensively with little Bushy and Cheney cheering on the Iraq war, and staying in Iraq.

Why would Obama hire a man at treasury who was a Kissinger protege?????? and worked for the CFR...See Geithner's dad was top dog at the Ford Foundation and Obama's mom worked with him..

And is it any wonder to anyone then, why Obama was on 60 minutes laughing about the auto industry 4 days before he canned the CEO of GM?? Then "fired him" the same day the Ford Motor company announced at the pres of Mexico's palace, that they were opening a factory in Mexico..with 4,500 jobs for Mexicans..

Oh , the CEO of Ford had this to say about Mexican Labor..while pissing on jobs for Americans..

Mr Mullaly said: "We are convinced the geographic location as well as Mexico's highly qualified labour force and economic stability make this decision the right one for our business."


http://news.bbc.co.uk/2/hi/americas/7428952.stm



But don't worry kiddies..don't listen to us old folk..it's not like we haven't seen this shit over and over again...ohh have we seen it..

Just keep getting your posting orders...and $$$...leave the real work to us old folks..we get it..we get it real well!

When you are waiting for your trickle down..it will keep trickling up..and you won't see a fucking dime of it...you will certainly not be a beneficiary. In fact you will see shit jobs in your future..and your future will be shit!

So keep posting your groul..It is you that will pay the dearest price!!


The Bailout Double Standard And The Revival Of Reaganism


http://www.huffingtonpost.com/david-sirota/the-bailout-...

[flyarm]

71. please young people..do some research on Kissinger..the man Obama sent to Russia

shortly after taking office..to represent his "NEW" administration.....

The man who's Nick Name is "THE BUTCHER OF CAMBODIA"

I will help you out a bit here..


KISSINGER.. who GWBUSH named to run the 9/11 coverup commission..he left the commission after families of 9/11 objected so loudly and angrily. ( thanks to the Jersey girls)

Kissinger's Back...As 9/11 Truth-Seeker posted by David Corn on 11/27/2002 @ 4:19pm

http://www.thenation.com/blogs/capitalgames/176


SNIP:
Asking Henry Kissinger to investigate government malfeasance or nonfeasance is akin to asking Slobodan Milosevic to investigate war crimes. Pretty damn akin, since Kissinger has been accused, with cause, of engaging in war crimes of his own. Moreover, he has been a poster-child for the worst excesses of secret government and secret warfare. Yet George W. Bush has named him to head a supposedly independent commission to investigate the nightmarish attacks of September 11, 2001, a commission intended to tell the public what went wrong on and before that day. This is a sick, black-is-white, war-is-peace joke--a cruel insult to the memory of those killed on 9/11 and a screw-you affront to any American who believes the public deserves a full accounting of government actions or lack thereof. It's as if Bush instructed his advisers to come up with the name of the person who literally would be the absolute worst choice for the post and, once they had, said, "sign him up."


SNIP:

Vietnam. Kissinger participated in a GOP plot to undermine the 1968 Paris peace talks in order to assist Richard Nixon's presidential campaign. Once in office, Nixon named Kissinger his national security adviser, and later appointed him secretary of state. As co-architect of Nixon's war in Vietnam, Kissinger oversaw the secret bombing campaign in Cambodia, an arguably illegal operation estimated to have claimed the lives of hundreds of thousands of civilians.


SNIP:

Chile. In the early 1970s, Kissinger oversaw the CIA's extensive covert campaign that assisted coup-plotters, some of whom eventually overthrew the democratically-elected government of Salvador Allende and installed the murderous military dictatorship of Augusto Pinochet. On June 8, 1976, at the height of Pinochet's repression, Kissinger had a meeting with Pinochet and behind closed doors told him that "we are sympathetic to what you are trying to do here," according to minutes of the session (which are quoted in Peter Kornbluh's forthcoming book, The Pinochet File.)

SNIP:

In another lawsuit, filed earlier this month, eleven Chilean human rights victims--including relatives of people murdered after Pinochet's coup--claimed Kissinger knowingly provided practical assistance and encouragement to the Pinochet regime. Kissinger's codefendant in the case is Michael Townley, an American-born Chilean agent who was a leading international terrorist in the mid-1970s. In his most notorious operation, Townley in 1976 planted a car-bomb that killed Orlando Letelier, Allende's ambassador to the United States, and Ronni Moffitt, Letelier's colleague, on Washington's embassy row.



so ask yourself..if Obama is so different..why did he have Kissinger represent his administration in Russia???????????

The very pig who was a constant visitor to the Bush Cheney administration and advisor on the Iraq war????????Oh and it wasn't advise to leave Iraq..it was to stay.....

[specimenfred1984]

16. Sure they knew, but there are so many people who are willfully blind

and greedy and think they're superior because of their greed or sanctimonious ability to forgive criminals that they got away with it. It'll keep happening too, the American populace is a dumbed-down bunch of suckers. We've got Goldman Sachs and AIG running Obama's economic policies, the corrupt World Bank just got a trillion dollars and American manufacturing is being allowed to go out of business. The solution is simple enough too, it's just being completely ignored: get banks out of gov't decisions and arrest criminals.

Neither are happening so the BS continues.

[flyarm]

34. "the American populace is a dumbed-down bunch of suckers" you can say that again!

You see it everyday on these boards!

either that or they are just paid shills ..
eom

[Vilis Veritas]

74. People are not 'willfully' blind...

Certain people have been trained, against their will and through means that are more devious and insiduous than the Nazi propoganda machine that manipulated masses of people to commit atrocities. You can not blanket blame all people for being willful, the nature of the beast is far more insiduous and finds ways around personal 'will'

While it may be easy to say, 'get banks out of gov't decisions and arrest criminals', the reality may make that impossible, i.e. ex-bankers in gov't positions and a unwillingness to slap hand cuffs on themselves. When the very foundations of a Republic becomes corrupt, there is only one solution.

Vilis Veritas

[Fumesucker]

20. Thank Gawd It Passed..

That's all I have to say on this subject. :evilgrin:

[SammyWinstonJack]

67. !

:thumbsup: :evilgrin: Where are those cheerleaders?

[Initech]

22. Let 'em die. For real.

[Vidar]

24. But our Vichy administration continues to defend & subsidize them

[flyarm]

26. K&R..thank you Kpete!! eom

[notadmblnd]

30. since congress hasn't done anything about it and it doesn't appear they will...

can the international criminal court go after them?

[bvar22]

31. K&R

Bread and Circuses for the Peasant Class and Indentured Servents.....only not so much bread anymore.
...just the Circus in DC and American Idol.

[katty]

32. of course they knew! did anyone actually believe they DIDN'T?!

[Brucie Kibbutz]

33. great post, kpete

Thanks for the info. K&R

[RagAss]

35. Viva La Guillotine !

[harmonicon]

36. also: duh

[winyanstaz]

37. Well how else could they destroy the economy and force us into

their New World Order? Of course they knew and its all going according to their plans.
To think for a minute that the Bankers and Wall street and private investors DID NOT KNOW is ludicrous..of course they knew! That is their job to know! Thats what they do. How could they not know? sheesh.

[Brucie Kibbutz]

38. Would you care to comment on this Mr. Geithner?

"I could explain it to you but it would take too long and you wouldn't understand it anyway". "It's really nothing to worry about". "Just let me handle it.".

[chimpymustgo]

40. Oh Gawd, this makes me ill. Of course they knew. I was so thrilled watching Obama today. This is a

sad reminder of who's really pulling ALL the strings.

[Brucie Kibbutz]

41. I know how you feel.

I had my hopes up too but I should have known better.

[Fire1]

42. They knew they didn't have the money to pay off CDS's.

[santamargarita]

45. All with the participation/blessing of the Bush Crime Family

:grr:

[eridani]

47. So, who do we write to on this besides our congresscritters?

I've written to our entire state congresional delegation. Who else?

[politicallore]

51. Of course they knew... and we are still giving them money... Who is the stupid one?

[keepthemhonest]

52. good if they can prove that then prosecute

I am sick of all this shit ,these people need to go to jail.

[Wizard777]

55. They would have to prosecute the entire industry.

[notesdev]

60. That is what needs to be done

Sort the innocent from the guilty and punish the latter to every possible extent.

[Wizard777]

75. No sorting is needed. They would all be guilty. Insurance = Ponzie Scheme

[BeFree]

53. AIG

Away It Goes... our money and our financial system...Away It Goes

[Wizard777]

54. Yes the insurance industry is a huge legalized Ponzie Scheme.

It's been said for decades. Nobody wanted to listen. Maybe they'll listen now.

[Grinchie]

58. Not only legalized, but Compulsory in many instacnes.

Financing a car? Comprehensive for you!. Want to register it? Insurance mandated by LAW! Have a Mortgage? Mandtory Fire Insurance, and if the loan is shady, Mortgage insurance.

Katrina? Nah, we call insurance company rules, and run out of town.

You live on the coast? Well, will franchise out our global company into tiny localized fiefdoms that get to charge more depending on what block you live on. Never minf that the headquartes still collects everything into a big pile, and then buys out farmland and leases it out to grow GMO Crops or raise millions of chickens at a time.

[Norrin Radd]

57. kr

[bobshin]

61. Now it's too big to investigate.

If this is true our Pres and most of the House are complicit for not investigating this before handing out OUR money.

[ezdidit]

62. It was NOT a Ponzi Scheme; it was a "CONTROL FRAUD"...

Fraud and money laundering...

William K. Black at HuffingtonPost exposed it in depth on February 9, 2008, here: http://www.huffingtonpost.com/william-k-black/the-two-documents-everyon_b_169813.html

Note that it is the Chinese who are most aggrieved about tax havens. The pressure on China is enormous. They own US treasury notes and have been most defrauded by naked CDS's. ...China, the world's factory that keeps itself running by manipulating the value of the yuan to overwhelm the world's economies with its goods. And the world played along. They really pissed off Sarkozy when they threatened to expose the deals by naming the banks and havens.

The CDS/CDO schemes that have collapsed the worldwide credit network were designed and executed to stretch capital resources to the breaking point and then break the financial system to create a pretext for the enrichment of only the wealthiest elites through their private tax haven banks.

Madoff's personal profits came from foreign banks that employed the vast network of tax havens worldwide to provide an extraordinary opportunity for nations to conceal transfers of wealth right out of sovereign treasuries into the private banking sector unconstrained by any oversight. It was fraud and money laundering, fully sanctioned by national governments in the form of debt obligations.

And their target dupe has been China...

[SlingBlade]

69. Of Course "They" Knew

"THEY" Helped set the whole goddamed thing up :argh:

[harun]

70. I would like the Obama administration to come up with a list of all "too big to fail"

companies and what they plan on doing to break them up.

[bullwinkle428]

73. Credit Default Swaps in general sound like a giant Ponzi scheme -

it didn't stop our wonderful Republican Congress from ramming it through back in '99...