Michael
Dec 7th 2009, 12:09 PM
The issue has been festering for months: Why were AIG's counterparties—including Goldman Sachs, JPMorgan Chase, and UBS—paid 100 cents on the dollar when the feds rescued the insurance giant, helping raise the cost of the bailout to nearly $200 billion? A new report issued by Special Inspector General Neil Barofsky now reveals that government officials, notably then-New York Fed President and current Treasury Secretary Timothy Geithner, grievously damaged the nation and capitulated to the very banks they should have been supervising.
Barofsky's report reads like a case study in failed negotiation. The New York Fed didn't have the backbone to stand up to Wall Street, didn't understand its capacity to protect taxpayers, and didn't appreciate that its responsibility was to taxpayers.
Source - Slate! (http://www.slate.com/id/2236460/)
This isn't actually news. And the source is highly questionable.
But the issue is still relevant. Why did Geithner use taxpayer money to payout AIG's debt at 100 cents on the dollar?
By every standard of analysis, this looks stupid, foolish and a very bad deal for the taxpayers.
Sure would be nice to see some accountability in Washington (there is none on Wall Street). I'd like to see Timothy Geithner's head roll for this. Rewarding one's friends with taxpayer money should put this bastard in jail. I'll settle for termination with cause.
Barofsky's report reads like a case study in failed negotiation. The New York Fed didn't have the backbone to stand up to Wall Street, didn't understand its capacity to protect taxpayers, and didn't appreciate that its responsibility was to taxpayers.
Source - Slate! (http://www.slate.com/id/2236460/)
This isn't actually news. And the source is highly questionable.
But the issue is still relevant. Why did Geithner use taxpayer money to payout AIG's debt at 100 cents on the dollar?
By every standard of analysis, this looks stupid, foolish and a very bad deal for the taxpayers.
Sure would be nice to see some accountability in Washington (there is none on Wall Street). I'd like to see Timothy Geithner's head roll for this. Rewarding one's friends with taxpayer money should put this bastard in jail. I'll settle for termination with cause.