In The Red, White, and GOLDman Sachs I wrote:
And then I went on to catalog all the Goldman cronies now shepherding the *bailout* funds.
Think my conspiracy theory is crazy?
There's more from the Washington Post last week:
Effectiveness of AIG's $143 Billion Rescue Questioned
A number of financial experts now fear that the federal government's $143 billion attempt to rescue troubled insurance giant American International Group may not work, and some argue that company shareholders and taxpayers would have been better served by a bankruptcy filing.
The deal that the Treasury and the Federal Reserve Bank of New York pressed upon AIG was intended to stop any domino effect of financial institutions falling because of their business ties to AIG. The rescue allowed AIG to provide cash to huge banks and other players who had invested in rapidly souring mortgages insured by the company.
Early this year, investors had begun privately demanding that AIG pay off its billion-dollar guarantees. But in mid-September, when the demands for cash reached a public crescendo, AIG had to admit that it didn't have enough cash on hand to meet the obligations.
In the first weeks of its federal rescue, AIG has used the loan money to post collateral demanded by these firms, sources close to those deals say.
The company may be forced to borrow additional federal funds for rising payouts to counterparties. Neither the government nor AIG is releasing information about the specific amounts paid to individual firms, but numerous credit experts say that the value of those mortgage assets is probably declining every week. That means AIG has to pay a higher price as part of its guarantees.
In February, internal notes show, board members discussed a growing dispute between AIG Financial Products and Goldman Sachs about the value of those assets when Goldman called for AIG to post collateral. AIG's chief financial officer warned of "Goldman's acknowledged desire to obtain as much cash as possible." But AIG's external accountants warned that it was they who alerted management to the dispute, not AIG Financial Products, and that the division was not properly considering the market in its pricing.
Rutledge warns that because there has been no public disclosure of AIG's payments to counterparties, it is impossible to know whether the pricing it is using now is proper.
Let it be noted that the lack of full disclosure is actually standard practice for this *bailout*. A month ago, in The Broad Daylight Rape Of Joe Taxpayer, I promulgated:
That means that the government knows which banks are in trouble, is giving them taxpayer dollars, AND is concealing their identities from the public!!!
The original $85 billion dollar *advertised* AIG bailout has taken two jumps. First it was bumped to a $120 billion *investment* then just last Thursday it borrowed another $40 billion from the Treasury. Remember what hotshot John Maudlin said initially, "My bet is that the taxpayer is going to make a real profit on this deal."
Yeah, Goldman's stock has been hammered, they are laying off a few thousand, and their bonuses have to be down (I'd assume).
BUT, by rights, they should be bankrupt. Their partners should probably have been wiped out if it weren't for such outright political thievery.
For the first three quarters of 2008, Goldman has reported profits of $4.4bn, down by almost half from last year's sum. According to SEC filings, it has set aside $11.4bn for pay and benefits, a decline of 32 per cent over 2007. Barring a big change in the firm's performance, the current partners can expect bonuses, on the average, of $1m or less, according to people familiar with the matter. (link)
On Saturday, some buffoon was telling me that things were so bad at Goldman that they were "de-partnering" people. According to that link just above, they boot partners out biannually - at the same time they bring in new ones as well. Nobody has permanent tenure there - which is wise from a business standpoint.
Of all the epithets apt for Goldman crooks, no one can ever call them stupid.
Note also their smart political contributions - the largest of any Wall Street firm.
So go on ahead, ignore the