The Real AIG Scandal

The Real AIG Scandal

www.slate.com

Everybody is rushing to condemn AIG's bonuses, but this simple scandal is obscuring the real disgrace at the insurance giant: Why are AIG's counterparties getting paid back in full, to the tune of tens of billions of taxpayer dollars?

they feared a systemic failure could be triggered by AIG's inability to pay the counterparties to all the sophisticated instruments AIG had sold. And who were AIG's trading partners? No shock here: Goldman, Bank of America, Merrill Lynch, UBS, JPMorgan Chase, M

(visit the link for the full news article)

So here are several questions that should be answered, in public, under oath, to clear the air:

What was the precise conversation among Bernanke, Geithner, Paulson, and Blankfein that preceded the initial $80 billion grant?

Was it already known who the counterparties were and what the exposure was for each of the counterparties?

What did Goldman, and all the other counterparties, know about AIG's financial condition at the time they executed the swaps or other contracts? Had they done adequate due diligence to see whether they were buying real protection? And why shouldn't they bear a percentage of the risk of failure of their own counterparty?

What is the deeper relationship between Goldman and AIG? Didn't they almost merge a few years ago but did not because Goldman couldn't get its arms around the black box that is AIG? If that is true, why should Goldman get bailed out? After all, they should have known as well as anybody that a big part of AIG's business model was not to pay on insurance it had issued.

Why weren't the counterparties immediately and fully disclosed?

This is an interesting article.




It's all about focusing on the source of the problem and not just the symptoms!

www.slate.com
(visit the link for the full news article)

I think the question of what was said at these meetings cuts to the heart of the matter. Where is the transparency guaranteed to the people under the Constitution in relation to the use of their money? How is it that Bankers came to have absolute control of the public purse that the Constitution laid Solely with Congress? The Constitution was shredded back in 1913 and it's time the public realized it!

reply to post by HimWhoHathAnEar


wow
very very well said friend1