Wall St. Bailout: Is A Massive Scandal About To Unfold?

[kpete]

Wall St. Bailout: Is A Massive Scandal About To Unfold?
by bobswern
Sun Mar 08, 2009 at 04:45:01 AM PST

Are facts concerning details of the current Wall Street bailout--past, present and future--about to unfold in a manner which may very well undermine President Obama's first term unless he acts immediately to staunch the damage created, and the damage about to be created, by the missteps of both (former) Bush Treasury Secretary Henry Paulson, as well as (current) Obama Treasury Secretary Tim Geithner?

...........................

Reports have been circulating, based upon leaks to the media over the past 24 hours, that:

1.) AIG ("Bad Bank" #1): $50 billion of the $173 billion forked over to AIG, since September, has been doled out to a handful of Wall Street heavy-hitters--a/k/a the "couterparties" that paid AIG to insure their toxic paper--to support their so-called insurance claims, backed by the good faith of AIG; folks who happened to make a pantload of money writing insurance policies on these Credit Default Swaps and Commercial Debt Obligations over the past few years.

We have Ms. Morgenson in the NY Times telling us the counterparties' sweetheart deals are "likely to increase" in terms of sheer numbers of billions of taxpayer dollars. But, it's the additional documentation ("NEW INFO") below Morgenson's quote which is most troublesome...it's not $50 billion...it's already $80 billion...and these same firms are receiving 100 cents on the dollar for this toxic paper, too!

Gretchen Morgenson tells us in Sunday's NY Times: "A.I.G., Where Taxpayers' Dollars Go to Die."

A.I.G., Where Taxpayers' Dollars Go to Die
Gretchen Morgenson
March 8, 2009

...Mr. Liddy wouldn't provide details on who the counterparties were or how much they received. But a person briefed on the deals said A.I.G.'s former customers include Goldman Sachs, Merrill Lynch and two large French banks, Société Générale and Calyon.

All the banks declined to comment.

How much money has gone to counterparties since the company's collapse? The person briefed on the deals put the figure at around $50 billion.

Unfortunately, that is likely to rise. http://www.nytimes.com/2009/03/08/business/08gret.html?_r=2&adxnnl=1&ref=business&adxnnlx=1236502889-+AeFgr9ecukV/IrkscDfoQ

NEW INFO: It's already a LOT more than $50 billion, which was reported as "the number" in the past 24 hours; it's at least $80 billion and growing, or almost half of all the funds sent to AIG to date...and growing; perhaps much more if not MOST of the funds dished out to AIG to date all going to the same usual suspects...
The facts are we may just be scratching the surface on the AIG matter. It's going to--and already is--getting much more out-of-hand than originally reported, and virtually all of those funds has gone to the same 20-25 firms (and that's only as of late December '08); and, perhaps even more outrageous, it appears that a trend had developed early on with regard to these toxic debt purchases, whereby the recipients (that same list of 25+/- firms) of the Treasury Department's and the Federal Reserve's largesse were profiting to the tune of 100% on the actual value of the paper being purchased. They're doing this by allowing the counterparties to KEEP the collateral, on top of receiving the payments!!! (See story link and quote, immediately below.) In other words, the Fed was overpaying these firms to the tune of full face value, 100 cents on the dollar, on paper that was only worth from 20 cents to 60 cents on the dollar in the marketplace!

more plus lots of links:
http://www.dailykos.com/storyonly/2009/3/8/7452/30422/848/705961

[Hannah Bell]

1. shut them down, unwind the bets, take back the money, & put them in jail.

8.5 trillion spent so far on this mess & no end in sight.

remember how they told you that paying back the 2 trillion in the social security trust fund over 30 years was going to bankrupt the country?

country's run by liars, thieves, grifters.

[Jambalaya]

28. ANTI-Social IN-Security

The real owners are the big wealthy business interests that control things and make all the important decisions. Forget the politicians, they’re an irrelevancy.
The politicians are put there to give you the idea that you have freedom of choice. You don’t. You have no choice. You have owners. They own you. They own everything.
They own all the important land. They own and control the corporations. They’ve long since bought and paid for the Senate, the Congress, the statehouses, the city halls. They’ve got the judges in their back pockets. And they own all the big media companies, so that they control just about all of the news and information you hear. They’ve got you by the balls. They spend billions of dollars every year lobbying – lobbying to get what they want. Well, we know what they want; they want more for themselves and less for everybody else,”

“But I’ll tell you what they don’t want, they don’t want a population of citizens capable of critical thinking. They don’t want well-informed, well-educated people capable of critical thinking. They’re not interested in that. That doesn’t help them. That’s against their interests. They don’t want people who are smart enough to sit around the kitchen table and figure out how badly they’re getting fucked by a system that threw them overboard 30 fucking years ago. You know what they want? Obedient workers – people who are just smart enough to run the machines and do the paperwork but just dumb enough to passively accept all these increasingly shittier jobs with the lower pay, the longer hours, reduced benefits, the end of overtime and the vanishing pension that disappears the minute you go to collect it. And, now, they’re coming for your Social Security.
They want your fucking retirement money. They want it back, so they can give it to their criminal friends on Wall Street. And you know something? They’ll get it. They’ll get it all, sooner or later, because they own this fucking place. It’s a big club, and you ain’t in it. You and I are not in the big club.”

-George Carlin

[druidity33]

68. i love that rant...

and i hate it, because George was too fucking right.

:(

[graywarrior]

76. John Grisham's book The Appeal is exactly about that.

Everyone is bought and paid for and no matter how rational and human a cause is, "owned" judges and civil servants can sway things they way the owners want. They always win, even when we think they have lost.

[Fire1]

94. That's right and also why Madoff won't be doing much jail time,

if any and if anybody thinks for one minute that family will be ordered to shed their wealth to pay restitution,
I've got a bridge to sell!

[Sarah Ibarruri]

57. Exactly. Why isn't jail playing a part in this? nt

[Raksha]

88. Right on, Hannah!

Re shut them down, unwind the bets, take back the money, & put them in jail.

Did the SAME handful of crooks manage to get their greedy mitts on 90% of all the money in the United States, or is it only 75%?

Bloodsuckers, vampires...there's just no other word for these scumbags.

[natrat]

2. massive scandal,yes--about to unfold,sadly no

[truedelphi]

38. Explain please.

I am seeing this discussed on the pages of the NYT and also in RW blogs.

Why won't it unfold?

Of course, there was that moment back in 1994 when the Chiappas revolution was taking place and all the major media outlets sent their young reporters in.

Reports were coming from the hills of Mexico every other hour. ANd even some one hour specials, done in an excellent Edward Murrow type style.

Then Friday of that week, Tonya Harding's posse slammed Nancy Kerrigan's kneecap, and the networks went all Tonya, Nancy 24/7.

The Chiapas revolution was not mentioned for at least some three weeks. Nothing on the story, NADA.

What happened, I said to myself. Many years later, reading in a Rolling Stone article, there was a single sentence that said "Citibank knew it was not for its best interets that the Chiappas "situation" be discussed, and it effectively shut the media down on that issue."

So since Big Money, Big Oil, Big Pharma, Big Defense, etc controls our media, perhaps you are right.

[natrat]

52. ok unfold perhaps but will anyone be held accountable ? yea sure

[caseymoz]

62. Ultimately, the people at the lower end aren't going to take this anymore.

You can't say when exactly it's going to happen, but I have to think that we're getting close, especially as the economy disintegrates.

[Rockholm]

70. The people at all ends aren't going to take this anymore.

The people at the lower end have very little stake or exposure in any of this. The people in the middle have the biggest stake in getting this mess straightened out. The people at the top want this to clear up but may not have the "encouragement" to do so.
The shadow markets are driving the economy down. They have been betting on the market to fall and they are making a fortune on the market tanking. There are hedge funds and other vehicles that one can invest in that will pay out big when markets go down.

[BelgianMadCow]

86. "not taking it anymore" - well, civil unrest is now the n°1 security threat, not terra terra

that's in the US.

Also read 'hot (protest) summer expected' in a French and UK newspaper.

[caseymoz]

97. I don't know that they have been betting on the markets falling.

There will still be only about an equal amount of winners and losers from that, unless of course, they market is fixed-- and that is quite possible. However, as the market is a chaotic system, with hedge funds, you are just gambling, again, unless it's fixed.

I don't know if the people at the lower end don't have a stake in this. If their lives get worse, and if their ranks are swelled by people falling from the middle, or even fall from the upper ranks, (a lot of people have lost jobs on Wall Street) then things can turn extremely ugly.

Need some kind of rules of status (economic and social rules, including laws) around them, and for that reason, it takes an awful lot for them to totally reject a system even when they come out on the low end. But if it looks like the status rules assure that their lives will simply get worse and worse, and if it looks like the rules are being fixed so that the same bunch of people gain more and more, that's when they'll stop obeying the rules that have benefited others. That's when they'll withdraw permission to be governed.

[truedelphi]

98. Over the last 72 hrs, there have been several entries here on DU about how the

BailOut monies from las t Oct got siphoned off to bet against the economy recovering. SO now we have even more AIG bailing out to do.

[sandnsea]

3. Public Support For Nationalization Builds

This will help push that along, whether that's the Obama plan at this point, or not.

Nobody will be surprised at this and it just proves what kind of greedy fucks Republicans are. I don't see how anybody is going to pin this scandal on Obama.

[flyarm]

13. That scares me as well..

it would be the same idiots on both sides of the isle that used our tax dollars to pay off bad gambling debts that our grandchildren will now be paying for!

Be afraid , be very afraid..of the very people nationalization will turn the keys to the bank vault over to!

[sandnsea]

16. I know

But I think that is just how bad it is. I am most afraid of what a country without a banking system is going to look like.

[flyarm]

23. look to history and think hard of what

Hitler nationalized.

and be very careful..prepare your family..and think ..NEW WORLD ORDER

[sandnsea]

26. No, it is not going to be like that

That's what they said about FDR too. That kind of thinking is what got us the John Birch Society and all the nutters who oppose everything government does, the very things that would have prevented this mess.

No, we're going to need a bigger intervention into this mess because the financiers are just too crooked to even see that their house is on fire as they're putting money in the mattress.

[flyarm]

27. I sincerely hope you are right..you must believe as you do..

i look to history to base my beliefs..and i have read all of Leo Strauss's writings..and it scares the hell out of me..

When i see our tax dollars being used to bail out banks all over the world..i have never seen in my 56 years anything that looks like this..and if this isn't a new world order, i don't know what it is.

Do read and see who Leo Strauss wrote who will bring the new world order about.

I was in my local food mart the other day and i know the owner and he told me , that Canadians keep coming in his store trying to barter for food..this is in Florida. They told him many stores here are bartering for their business!

I turely hope you are right and i pray i am wrong..but in my neighborhood that i moved out of a couple years ago..all my neighbors in NJ had seats on the stock exchange..most of them have sold off their seats or closed down their seats.

One such neighbor, i just read was was mentioned in an article about the UBS scandal..

I for one hope if he was involved in bilking our government of taxes by helping people shelter their money out of the country illegally, i hope he see's some long days in court and if found guilty of anything illegal..i hope he sees the inside of a prison.

But people like him rarely do..it is the guy/gal who works their ass off and does everything expected of them..within the laws of this land of ours who loses everything , and they are the people i truely care about.

[flyarm]

30. oh and i just remembered..Lou Dobbs had on his screen the other day..

NEW WORLD ORDER...on the side of his screen, it was the headline.

I have heard him talk about it before..but i have never seen him have it written as a segment headline.

sorry i can't tell you what day but it was early last week.

And when Trump was on Larry King he talked about this money going to foreign banks.

[truedelphi]

82. Thanks flyarm for the rec on Leo Strauss. Will check himout. n/t

[truedelphi]

40. I could put more stock into what you were saying if

Obama, on the financial front, was not selling us out every minute of every day.

It's bad enough that his trio of Bad Boys remain as his executives in charge of the financial mess. Why did he ever choose the likes of Geithner, Runbin and Summers? And Gensler is creeping around in the mix now as well.

Then last week he brings Rahm Emanuel's brother into the fray as his heathcare adviser. Yeesh and double Yeesh. Those of us wanting Single Payer Universal Health Care felt an ill wind that moment, I'll tell you.

FDR did not appoint the foxes to guard the hen house. And unless Obama wakes up sometime soon and re-thinks who his top people are, I am not sure that we can turn the tide ont his financial crisis.

[cascadiance]

61. Damn Straight!

We need to stop the corporate Rahm-per room!

[truedelphi]

39. Same thought here, flyarm.

We are damned if we do, and damned if we don't.

[SpiralHawk]

4. According to one of our local Medicine Men...

and he has a track record of accuracy...Major MAJOR Major illusions & frauds will soon become plain.

[flyarm]

10. They already are..

for those who have pay close attention..

[Helga Scow Stern]

15. Yes, beginning this month and hitting more widely in May.....n/t

[inna]

67. does he have a long-term prediction/prognosis?

no sarcasm at all, it's just that.... it would be nice to know; the future seems very uncertain and shaky right now.

[Rockholm]

71. One sage person mentioned the FDIC will go under by June.

I am moving my money tomorrow.

[flyarm]

5. Some banks that were paid by AIG after it was bailed out by the government (Source: WSJ research):

Some banks that were paid by AIG after it was bailed out by the government (Source: WSJ research):
Goldman Sachs
Deutsche Bank
Merrill Lynch
Société Générale
Calyon
Barclays
Rabobank
Danske
HSBC
Royal Bank of Scotland
Banco Santander
Morgan Stanley
Wachovia
Bank of America
Lloyds Banking Group

http://johnbatchelorshow.com/jb/2009/03/aig-conspiracy-of-witches/

[FormerDittoHead]

8. It's paying off FOREIGN banks that ices me...

Where is the point when these guys who were making 15% returns are willing to assume the RISK of their investments?

It's complicated. I understand that, and I don't want to just pull the rug out and let the 'house of cards' fall down as it COULD... HOWEVER.

How the FUCK does OUR national debt go up to give TAX DOLLARS to FOREIGN BANKS to cover the risk they assumed????

Add to that the even more tricky question of foreign investors.

I don't give a SHIT if some millionaire in England or Germany stands to lose a boatload of money. He paids his moneys and he tooks his chances - HE LOST. If he didn't want the RISK, he could have bought our BONDS, which I fully accept having to pay off.

This is bullshit.

[notesdev]

9. They were defrauded too

The credit rating agencies colluded with the investment banks and insurers like AIG to represent the riskiest mortgages ever issued as AAA-rated, near-riskless debt.

However, not to let them off the hook, the investors too failed to do their due diligence.

[flyarm]

11. they were gamblers in it all..why do our tax dollars have to be used to

pay off their gambling debts????????

[FormerDittoHead]

14. So let them sue S&P and Mooney's. "AAA" is not riskless.

I wouldn't put the BLAME on them, but they DO get the responsibility. They weren't going to share the PROFITS they expected, I say we don't share the RISK. *I* didn't rip them off, nor did our government.

Is the point of the tax dollar bailout to help with FOREIGN jobs and markets OR OUR OWN?

I know it's more complicated than that, but at some point you can put a German billionaire's face on this situtation, and say THIS GUY got hundreds of millions / billions of OUR dollars, while WE'RE being thrown out of hospitals and our homes, and there's NO JUST WAY TO JUSTIFY THAT.

Again, if foreign investors bought gov't bonds, with the understood (lower) risk, I would support our tax dollars paying them off. Absolutely.

I know finance. Here's the rules: higher returns MEANS higher risks. These investors ASSUMED GREATER RISK. I've lost a shitload of money on the stock market - MY government ain't bailing ME out, THEY'RE BAILING OUT GUYS FROM OVERSEAS????

Sorry, that's bullshit.

[notesdev]

17. Of course it's bullshit

The whole freaking market became one steaming pile of bullshit (aka misrepresented risk levels). The credit rating agencies haven't remotely enough cash to compensate all the people who lost big because they invested based on agency risk ratings.

The people who made this fraud engine go belong in criminal court, not in civil court.

Where is the government? Why is Andrew Cuomo the only elected official who even appears to take the problem seriously?

[truedelphi]

83. Uh, Spitzer also took this seriously.

You can see where it got him.

[notesdev]

87. Spitzer thought himself above the law

which makes him an unsuitable prosecutor. Can't credibly enforce the law while ignoring it, and the blackmail potential of his situation was high enough that he'd not be trustworthy to get the job done. He had the other qualities needed, hard-nosed, determined, knowledgable - but a fatal flaw like that just puts him out of the game.

[truedelphi]

96. Oh for sure he brought it on himself.

But the sad thing is that if he were not someone knowledgeable about the insiders of this Banking Mess, and also about the ways and means to hold them accountable, all his sins would have been overlooked. I mean, his sins were a lot less than the pedophile Repugs that stay in office for years. Then late in their career their sins come to light.

[flyarm]

20. "THEY'RE BAILING OUT GUYS FROM OVERSEAS????" yes

it is not the mortgages that are sinking AIG..it is the worthless paper they sold with no collateral to back it they sold to foreign banks..the mortgages have property and structures that still exist as collateral..these Banks and foreign banks gambled on pieces of paper..Like a huge Ponzi scheme..and now our tax dollars are being used to buy up that worthless paper.

this stimulus bill is not helping people in this country who have lost their jobs..you only get help if you have "good Credit"..who has good credit when they have lost their jobs and fall behind inpayments and are having their homes foreclosed on???????..people stop living in a dream world..Obama's stimulus bill wmost americans will not see any relief until 2010-2011..

But these foreign banks are getting your money ..now..and shit loads of it.

You have been bamboozled if you believe in the pipe dream of any stimulus for regular Americans that are suffering.

[earth mom]

34. But-But-But-they gave taxpayers $13 a payday! Yipeeeeeeeeeee! NOT!

Yep, we're supposed to take this measly "stimulus" chump change and be happy with the shit sandwich they've served us while the banks & Wall Street live it up on Filet Mignon & Lobster-at our expense, literally. :grr:

[flyarm]

36. oh and next year it goes to a whopping $7. + change..

by next year that is what a starbucks vente frappachino will be!!..1...that be one..better make sure we all enjoy it!!

because our grandkids will all hold us accountable!!..not the bankers!!

[Kool Kitty]

66. You're such an optimist!

What makes you think that Starbuck's will still be around next year? ;)

[Tansy_Gold]

63. "it's not the mortgages that are sinking AIG"

(You know, of course, that it never was. That was the smoke screen, the distraction, the flimflam that got us all -- well, not all, but many -- to blame the homeowners who couldn't pay their mortgages or lived high on HELOCs and refis. It was never about the mortgages, not even about the housing boom. Never.)


(Why do you think that asshole Rick Santelli got so much air time with his bullshit rant about bailing out the neighbors who had an extra bathroom and couldn't pay for it? That guy isn't getting a bailout; at best he's gettin' a workout, but he'll still pay. No homeowner gets somethin' for nothin'. That kind of sweet deal is reserved for those who bet someone else's money, lost it, and are now getting it back into their own pockets.)


(That's not trickle down, honey; that's somebody rich pissin' on you.)



(Tansy Gold)

[rainy]

77. Didn't we sell them those crappy mortgages that we said were

AAA? We sold those toxic deals all over the world. Plus, AIG insured other crappy loans. So lots of countries are entangled.

[leveymg]

69. It's not just the European banks - AIG and HSBC are Hong Kong (Chinese) investment vehicles

This payoff of foreign Credit Default Swaps holders is extortion money to prevent a run on the Dollar by way of a threatened huge sell-off of treasuries, moneymarket funds, and other Dollar-denominated holdings.

We're in a position where our foreign debt is so huge that China and a half dozen other big sovereign wealth funds could destroy the US currency and economy. Of course, they would destroy themselves in the process. It's the private jackals, the hedge funds, that worry me more. Some sharp operator with a big stash of options and insiders knowledge of the secondary markets for treasuries and currency could set up a ruinous financial Sum of All Fears type economic war, and think they could come out owning the world.

[BelgianMadCow]

85. extortion money to prevent a run on the dollar - yup

have been trying to outline the same thought.

I would add that the ones "extorting" are also the ones that got fooled (not the ones that were doing the fooling).
That may be because I'm on the other side of the ocean...and who knows who knew how much about the piramid scheme...

It's really quite simple. China said back Fannie and Freddie or else. And the rest of the world is doing the same. The US is creating the money to dole out meanwhile, at the taxpayers expense (well, soon - now it's the Fed doling out the cash but when they become insolvent the Treasure has to cover).

LEAP/2020 predicts bankruptcy for the US this summer.

[Turbineguy]

6. A rich man's version of this:

Guy does $1000 damage to your car to steal your stereo which he sells to a fence for $30.

There are a few differences though. The stereo thief risks going to jail. The Bankers only got $10. And you don't lose your job and your home because somebody broke into your car.

[flyarm]

7. The September 2008 AIG Bailout Comedy Gets a Subplot.

http://johnbatchelorshow.com/jb/2009/03/aig-conspiracy-of-witches/

The September 2008 AIG Bailout Comedy Gets a Subplot.

snip:

Wall Street Journal Commenters Feature Much Paranoid Cleverness:


Below a selection of commenters from the Wall Street Journal story on the AIG pay offs to the Europeans and so forth. Many, many details to pursue, not the least being that Hank Paulson had advice and cooperation not only from the Democratic and Republican leadership of the U.S. Senate in the 110th Congress but also from New York Fed President Tim Geithner and Federal Reserve Chairman Ben Bernanke. This posse is still on the bridge of the wrecked and sinking ship, thought now it is Treasury Secretary Geithner, Fed boss Bernanke, and the usual suspects in the US Senate -- all now joined by the fresh leadership in the White House, Barack Obama, Rahm Emanuel, Larry Summers. No change in the AIG deal: we bail out Europe's sick banks as well as Goldman Sachs, Morgan Stanley, and the Merrill executives who are spending down their plundered 2008 bonuses quickly.

[truedelphi]

95. Amen, amen. n/t

[flyarm]

12. by the way..Thank You Kpete for staying on top of all this and so many other

subjects.

You are a jewel..

I don't come here very much anymore..but you are touching on stuff that other web sites have extensively reported on ,and many here on DU have chosen to ignore, and you don't get into all the crap that so many do here. You tell it like it is!!
And i appreciate that .

Again i say, you are a jewel.

fly

[earth mom]

35. I agree & I also wish you would post more-your honesty is a breath of fresh air that DU sorely needs

now more than ever. :thumbsup:

[bvar22]

18. !!!

NOW we have Your Children’s Money too !!!
And there is not a fucking thing you can do about it!
Now THIS is “Post-Partisanship” !
Better get used to it!!
Hahahahahahahahaha!

[leftofthedial]

19. paulson and geithner are birds of a feather.

and are the inside men on an inside job--the biggest single theft in world history.

[AllentownJake]

21. Geithner was a mistake

You need someone who understands the system and the problem but I believe Geithner is too invested in the old guard now to be effective in this time of crisis. He should resign.

[catzies]

29. Agreed. I want him gone. But I have no suggestions for a replacement.

But we need someone else, like, yesterday.

[girl gone mad]

50. Volcker. n/t

[vssmith]

74. I like Volcker

but Krugman or Stiglitz would also work

[flyarm]

33. no he was not a mistake..he is exactly who Obama wanted and for a specific reason. eom

[amandabeech]

42. Campaign cash?

Please dish if you have something.

[Lance_Boyle]

84. must be his astute awareness of tax policy

Geithner is a criminal appointed to oversee criminals. The fact that some here believe Obama can do no wrong is less and less amusing by the hour.

[riderinthestorm]

75. What specific reason? nt

[D-Lee]

22. Why would anyone expect the Bushie TARP contracts to be better than their "legal" opinions?

It just looks like more of the same low quality legal work to me.

Likely the contracts left every barn door open to anything.

Remember, these were the same Bushies who insisted on not releasing TARP expenditures, notwithstanding that a report to Congress on disbursements was required by TARP itself.

These were the "signing memo" folks who thought they could do anything they wanted and apply virtual white-out to legislative requirements they didn't like.

These were the "free market capitalism" folks who ignored the prevalence of all forms of corporate payola, favoritism, kickbacks, "scratch my back and I'll scratch yours" schemes and self-aggrandizement that took over major corporate decision-making.

My suspicion is that the results might scandalize the public but were not barred by Bushie-written TARP contracts.

We will see.

[SpiralHawk]

24. "Smirk." - xCommander AWOL Bush & Republicon Economic Cronies

[flyarm]

25. wake up..this is not one parties doing..

not by a long shot.

[Blackhatjack]

31. AIG was a 'pass through' and refusing to identify recipients was a huge red flag....

The problem the Obama ADmin has is that they 'know' who the ultimate recipients are and have been --which once it is known to the public the outrage is going to horrendous.

[flyarm]

32. Blackhatjack..thank you....absolutely!! You are 100% right!! eom

[truedelphi]

41. Yes, that is probably all too true. n/t

[WhiteTara]

37. Scandal? How about Criminal Enterprise

That little soft pedal...scandal is titilating, just past gossip. Sort of like harsh interrogation techniques instead of torture. We still live in the land of DaNile, as we tiptoe through the tulips.

[amandabeech]

43. Rico? RICO? Do I hear someone calling for RICO?

Take them down. All of them.

Then get our money back.

[truedelphi]

44. Actually don't know if you are familiar with the

Nine Eleven dollar designed by Nine Eleven Truther Carole Brouillet, but she has been calling for RICO on this for some months now.

Anyone on this board reading autorank's postings about the derivative deficit and what it meant has realized this since what - August of last year.

Unfortunately Obama has never read Autorank's posts <sigh>

And it pretty much looks like Obama and our nation would have been better off if he had just appointed Jon Stewart's writing staff to look into the financial crisis rather than the "blue blood" Wall Street types he has put on his economic team. Sometimes common sense and honesty trump "Ivy League Degrees" and criminality, in terms of preserving a nation's economic health.

[amandabeech]

45. I wasn't aware of the Nine Eleven site, but I will check it out.

I'm just an old former securities lawyer who lived through the '80s and early '90s in New York.

It's just deja vu all over again with some of the original characters.

The only difference is the cut of their suits.

Plus, I actually listened to Warren Buffet back in 2003 when he called derivatives something like "weapons of mass financial destruction." It's too bad that he didn't listen to himself.

I wouldn't condemn all Ivy Leaguers nor all blue bloods (whatever that means today).

The sharks come from everywhere today as they did yesterday, and should all be treated the same way.

[truedelphi]

79. Didn't mean that All BlueBloods should be condemned.

Those that have done an honest day's work are fine. Those who set up this bundle of corrupt economic packages, starting with "Trickle Down" and with "The Chicago School of Economics" etc should be hanging from lamposts.

[Fuzz]

46. "Why Daddy went to jail", Olbermann

[sarcasmo]

47. The whole to big to fail thing drives me crazier. If you fail you fail, period.

[DemocracyInaction]

48. Maybe I just dreamed all this but....

...I thought it became pretty well known in a wink-wink way after Paulson handed out the first TARP money and no one wanted to tell where it went or what they did with it, that a whole shit pot of it ended up in foreign hands because the entanglements are not as simple as "made in the USA". In other words, the foreign banks would have ended up collapsing our system. Oh well...we can bail out the world or not have work...I've watched too much of this crap for over 60 years. The Carlin quote in an above post is all you need to know. Spot on.

[Mike 03]

49. "The Counterparties"

Just make sure that is not your pension fund or 401K before you shut them down.

I could care less whether AIG fails or not. I'm okay.

But some people around here sound like goons, praying for the failure of these institutions, not even knowing what they do.

[natrat]

54. um..they are going to take that next...your beloved "institutions" are fraudulent

[truedelphi]

80. I don't see anyone here acting like a goon.

Some of us are frustrated beyond belief that it's been so very unbelievably set up for years and years. That anyone who understood that this economy was a House of Cards was thought simple-minded. Now the payback on the stupidity of those at the top (Who won't suffer at all, most of them) is apparent to one and all of us. And so everyone suffers because of the activites of the upper .01%.

Maybe from time to time, someone says, well I own my land outright and plant enough veggies to get by. But that's far less goonish than the spite and disdain that sort of person has had to suffer over the years. The perception by many over the last twenty years that you were an idiot to pay for things outright rather than get twice the house and three times the number of cars. That you were a "Drop-out" if life for you was more than the latest designer clothing.

Now that sort of person might get by, while the "more ambitious" fail. But since the entire economy is coming down, it is rather hard to gloat about it.

[girl gone mad]

51. It's even worse than that, kpete.

We didn't just give the CDS gamblers face value for their toxic contracts, we gave them 100% of FUTURE value. Some of these securities would not have paid out for decades.

[amandabeech]

64. Thanks for putting that so clearly.

This whole thing stinks.

Who's going to be the one to put the UV on it.

I'm taking nominations--

Gretchen M.?

Krugman?

KPete?

Some whistleblower in the U.K. formerly employed by AIG?

Geithner?

Summers?

[debbierlus]

53. They have been stealing us blind right before our eyes for years

It has become so large, and the dollar about to become so worthless...yes, the ending of this corporate fascist scandal will go Kabloom as our dollar become totally & utterly worthless, and the American people will be so destitute they will FINALLY take notice.

[pam4water]

55. They should have split off the insurance from the derivatives, and evaluated every

derivative to see what the systemic risk form defaulting on each would be. And pay out on a derivative if only and only if a bank of country was going to collapse if the derivative wasn't "honored" <-- :sarcasm:

[Blackhatjack]

56. There is one unavoidable inconvenient fact that we all must face ....

The truth is that all the derivatives created and traded among the various financial interests created hundreds of trillions of dollars of 'debt obligations' on paper which were like uncashed checks --valuable on a balance sheet but not worth the paper they were written on.

The 'unavoidable inconvenient fact' is that the guaranteed debt secured by these derivatives WILL NEVER BE PAID IN FULL. PERIOD.

At some point, those waiting with their hands outstretched are going to grasp this truth and begin talking about the massive transfer of wealth that is taking place ... but not going to them as they expected.

I suggest that the true international economic crisis will kick in when the foreign investors realize they won't be paid back in full to the tune of their investments PLUS the paper profits they thought were locked in and secured.

We are limping along here because no one wants to upset the shell game .... that we cannot possibly win as the game is structured at present.

[pam4water]

58. Now now according ot Greenspan it's working the way it is suppose to

"transferring money to those who need it the most" :sarcasm: :puke: Apparently I don't need the money :rofl:

[Blackhatjack]

59. At least he is consistent .... still wrong. n/t

[McCamy Taylor]

60. Please see my recent post abou the Carlyle Group. I believe AIG got money to funnel to Carlyle Cap.

the investment wing of Carlyle that went belly up to the tune of billions. This payoff would have been made in secret so that it would not look like Bush was doing it for his dad. It would keep Carlyle's name solid----and it needs to be investigated. Here is what I wrote last week.

http://journals.democraticunderground.com/McCamy%20Taylor/381

Nice start by the NYT. Let's see Obama get in there and starting naming names.

[ooglymoogly]

65. Gee whoda thunkit....Who could have known?

Right this was so pathetically obvious that anyone with two synapse to spit at each other could have predicted this...As I have been warning in every post on this subject. To believe that the congress and all involved were not a party to this is to say they are brain dead. This was a criminal fix from the start. As Kieth Olbermann has often said...."why daddy went to jail" but I think that is just wishful thinking....some folks really are above the law according to O. We just have to keep looking forward. The rear view mirror is against the law and counter productive. Yuh roight.

[Junkdrawer]

72. K&R

[vssmith]

73. The whole reason AIG was in trouble is that they

owed counter-parties big money because of the Credit Default Swaps. I wonder why people are even surprised about where the money went.

[jmg257]

78. Isn't this what they were supposed to do-pay off the insured/policies? What else

did anyone think they were doing with the money? They are an insurance company who owed big.?.

[newtothegame]

81. Isn't that their job?

They're an insurance company, shouldn't they be paying out the claims? What's the issue here?

[Mike 03]

89. We'll see. From what I know, the counterparties for AIG are people like you and me,

pension funds, 401ks, teachers, mechanics.

This conspiracy bullshit is beginning to piss me off. I'm amazed.

[burythehatchet]

90. Any word from President Cool Breeze?

[Mike 03]

91. If you are right about this, I will apologize; I just think this is more bullshit.

It doesn't help anyone at all to understand what is going on, or why, or what needs to be done to solve the problem.

More smoke and mirrors.

[unkachuck]

92. kick....n/t

[goforit]

93. America has shown...............WE CAN LIVE WITHOUT THESE FUCKERSS!!!

[Hotler]

99. Kicking. eom.