Sunday, March 29, 2009
"Troubled insurer [AIG], now 80% owned by US taxpayers, spent the weekend deflecting mounting criticism of how government funds have been funneled to various banks and used to pay employee bonuses at the business unit that almost sank the company. After calls for more transparency, AIG disclosed Sunday that roughly two-thirds of the federal aid it received had been paid out to trading partners such as banks and municipalities in the US and abroad. ... The disclosures highlighted the increasingly close but uncomfortable relationship between AIG and the US government, which six months ago was a restless creditor and now has little choice but to be a patient ally. 'Something is terribly wrong with this picture, and the reckless behavior at AIG must stop immediately,' said Rep. Elijah Cummings (D., Md), in a statement Sunday. ... The list of AIG's trading partners reads like a who's who of global finance. It includes big US banks such as Goldman Sachs [GSG], which received nearly $13 billion. Large European firms such as Societe General and Deutsche Bank also appear, each having received nearly $12 billion. Much, but not all, of the money was linked to contracts AIG sold the firms to insure against losses on securities--notably those related to US mortgages. ... There are political risks to the disclosures, notably the fact that taxpayer dollars are essentially passing through AIG to make whole private businesses and foreign banks", my emphasis, Liam Pleven, Serena Ng and Sudeep Reddy at the WSJ, 16 March 2009.
Is anyone surprised? AIG just changed its name to "troubled insurer AIG". GSG, Goldman Sacks US taxpayers. Indict GSG. End the bloodless coup. All "former" GSGers out of the government. Wasn't GSG hedged against AIG exposure? Well PWC, what did you find in your GSG "audit"? Anything? What will the SEC do about this? Or Lev Dassin SDNY US attorney?