Wednesday, March 18, 2009

The Real AIG Scandal

While the firestorm rages about the bonuses for the very individuals in that one unit of AIG that brought down the whole company writing toxic CDSes, the real scandal is that AIG was used as a conduit to give Goldman Sachs, JP Morgan Chase, Bank of America, etc., 100 cents on the dollar on their worthless assets. Elliot Spitzer reminds us of this (via dkos)

The AIG bailout has been a way to hide an enormous second round of cash to the same group that had received TARP money already.

Who are the parties really benefitting? The usual suspects: Goldman, Bank of America, Merrill Lynch, UBS, JPMorgan Chase, Morgan Stanley, Deutsche Bank, Barclays, etc. etc.

The same parties who had ALREADY milked us for billions.

They are now getting MORE billions through AIG.

Why did Goldman have to get back 100 cents on the dollar? Didn't we already give Goldman a $25 billion capital infusion, and aren't they sitting on more than $100 billion in cash? Haven't we been told recently that they are beginning to come back to fiscal stability? If that is so, couldn't they have accepted a discount, and couldn't they have agreed to certain conditions before the AIG dollars—that is, our dollars—flowed?

1 comment:

Rajan P. Parrikar said...

Isn't this lapse to be laid at Geithner's door? What a sorry set of appointments Obama has made.