Gov’t Audit Criticizes Handing of AIG Bailout - Geithner Approved

[Toucano]

A new government audit has found that the Federal Reserve Bank of New York mismanaged the $85 billion bailout of AIG by refusing to use its considerable leverage to wring concessions from AIG’s trading partners. This resulted in the New York Fed paying full market value for assets underlying credit default swaps written by AIG to Goldman Sachs and other banks. This was done even though at least one bank, UBS, offered to cancel the contracts for less.

http://www.democracynow.org/2009/11/17/headlines#5




Is anyone surprised that a poorly conceived bailout would end up being poorly executed? :mad:


edit: Added Geithner to the subject

[Sebass1271]

1. which bail out was this? Bush's or Obama's?

[Toucano]

2. AIG was bailed out under Bush.

Mr. Timothy Geihtner, as head of the New York Fed, oversaw the bailout of AIG.

Obama promoted him to Secretary of the Treasury.

http://www.google.com/hostednews/ap/article/ALeqM5hHfE_uh5x8AS69S7ajGaVyfnzM4gD9C0VU8O0

The Federal Reserve Bank of New York — headed at the time by now-Treasury Secretary Timothy Geithner — paid AIG's business partners full face value for securities so they would cancel insurance contracts AIG had written in order to ease the firm's liquidity crunch. But at least one of those partner banks offered to canceled the contracts for less, according to a report Monday from Neil Barofsky, the Special Inspector General for the $700 billion financial bailout Congress approved last October.

That means officials may have spent billions more than necessary to cancel debt insurance contracts with banks including Goldman Sachs Group Inc. and others, the report says.

[yurbud]

3. in case people don't read the text of your post: GEITHNER DID IT

He must go and the rest of the Goldman Sachs sociopaths.

[yurbud]

4. EMAIL TO OBAMA on TARP report, Geithner & other robber barons regulating themselves

Reading the Barofsky TARP report further confirms that Tim Geithner is either incompetent or more likely, working on behalf of Goldman Sachs and Wall Street in general instead of the American people.

The continued presence of Geithner, Robert Rubin, Larry Summers and others who helped craft the laws, regulations, and trade policies that led to our current economic crisis make me worry that any deals they make on your behalf with Wall Street will be for the benefit of their previous employers and their own investments, NOT for the American people.

Please clean this moral filth out of your cabinet and replace them with appointees the American people can trust.

Send yours:
http://www.whitehouse.gov/contact