Bernanke wanted to sue AIG

Federal Reserve Chairman Ben Bernanke wanted to sue AIG to stop the company from handing out hundreds of millions in bonus payments over the past two weeks. But Federal Reserve lawyers advised against litigation, fearing the bank would lose the suit and allow AIG to recoup huge punitive damages. Bernanke also said the Fed knew about the bonuses last fall and warned AIG management it had “deep concern” about the payouts. “Legal action could thus have the perverse effect of doubling or tripling the financial benefits to the AIG-FP employees,” Bernanke told the House Financial Services Committee Tuesday morning. AIG told the Federal Reserve that the bonus payments were mandated by binding contracts, even those to its financial products division, which was responsible for creating the credit default swaps that contributed to the current economic crisis.

Source


Either Bernanke wants it to seem that he had no choice, or he had a gun held to his crotch as he made this statement.

Sorry if this is in the wrong topic, I'm new here.

[edit on 24-3-2009 by Gokes]

Nice find. I am having a difficult time accepting that the chairman wasn't fully aware of the bonus situation, but in reality, abusive although it is, it's chump change compared to what the Fed has done and has been doing to our economy all along.

headline must be messed,

i didnt even read the article yet, but the source says B.B. wanted to sue AIG, not the FED,

huge difference

welcome! the rabbit hole is deep my friend, please dig in and any questions, feel free to send me a U2u message, and i will be happy to give my opinion on it, or offer clarification the best I can!

reply to post by vonholland


Pure semantics.

BB is Chairman of Fed. Same difference.

Not BB the average "Joe six-pack" who works construction.

Just sayin'.

Regards......KK

Murphy's Law .... Ben is a theorist and not a banker.

Yeah, that's my mistake. I posted this when i just got up haha.