The descent into the bottomless pit of bailouts continues. Today, American International Group, Inc. (AIG) is expected to report a $60 billion quarterly loss, the largest in corporate history. According to news reports AIG is getting another $30 billion in lifeline support from the government. Details are meant to be forthcoming today as well.
And for what? For having held our entire financial system up to ransom through possibly the most self serving and misguided exercise in mismanagement in the annals of American business. All the while the malign bumpkins who got AIG and us into this mess sit fat and happy in their sinecures in the corner offices of their bleeding company, counting the munificent paychecks and bonuses they cashed in along the way.
Please, don't take my word for it, but do read Joe Nocera's "Propping Up A House of Cards" in Saturday's New York Times. It will make your hair stand on end. Given all the mumbo jumbo and purposeful obfuscation that have become part and parcel of this financial disaster, it is reportage that for once is clear and lucid and permits one to fully understand the dimensions of the self-serving greed that has gotten us all to this place. To quote from Nocera's article, "It was extreme hubris fueled by greed."
It was the whole mindset in the banking/insurance casino industry that permitted obfuscation as a key element in "getting away with it," because no one but insiders could fully understand what was happening. One example cited is the term "credit-default swaps." What does it mean? If you know, well and good. But for most, it draws a blank, and yet it is an instrument that has put AIG, and now us, at risk for nearly $400 billion, bringing the entire financial system to the edge of the cliff, flirting with systemic disaster. Had it been called "credit default insurance," which in essence is what it is, clarity might have permitted earlier action. And worst of all, the inclusion of the word "insurance" would have obligated AIG to set aside mandatory reserves which might have permitted it to navigate through this mess. Anyway, read Nocera and you'll understand how we have all been taken to the cleaners.
By the way, one needs wonder why Joe Nocera and Gretchen Morgenson (another terrific columnist on the Business Pages of the New York Times) are not given their own column on the ever more somnolent op-ed pages of that heralded newspaper. Certainly what they are writing about strikes at the very core of today's issues. But then again the "Old Grey Lady" must know what it is doing as it navigates these treacherous shoals.
Instead, wall street is trying to legitimize Swaps.
Show me a salary list among the management at AIG. . .
A little Trivia, what does the current collapse of our financial system and the collapse of the banks prior to the 1913 creation of the Federal Reserve, JP Morgan and his Bank. JP Morgan created the bank runs prior to 1913 with rumor campaigns and market manipulation, and JP Morgan bank created the instruments known as Credit Default Swaps. Do you know where JP Morgan got his money for his Bank, answer -The Rothschilds.
Question, Who owns the money supply of the 'Free Country' the United State of America?
Question, who does the Federal Reserve Work For?
May I suggest you listen to a recent broadcast by NPR's "This American Life." It's not pretty but it will reduce the complexities to a level that most people will better understand.
http://www.thisamericanlife.org/Radio_Episode.aspx?episode=375
Incidentally, we're hostage to AIG. They are too big to fail: consider what would happen to us when 19 million life insurance holders suddenly started cashing out their AIG life insurance policies.
http://eye-on-washington.blogspot.com
obviously if aig goes down, it will pull the rest of the world down with it. this thing is
way to huge for american joe's and janes to wrap their heads around.......so let
the government keep throwing money at them................meanwhile make sure
the "loans" are paid back to the taxpayers. to the tune of an insurance policy
on every taxpayer who makes less than $250,000. when a taxpayer passes away,
aig has to pay that policy when presented with a death certificate
to the estate. i think $150,000 sounds fair...................trillions + interest......divided by..........
http://www.newsweek.com/id/164591
Read that elsewhere as well.
Might explain why no one knows how to "solve" this mess.
$600 TRILLION!
Worse, the Obama administration says they'll only look at derivatives and swap rules "later", meaning, never, or they'll beat up on rating agencies to be the fall guys.
Excellent article. Note with AIG, the article notes that the European banks are in trouble with this scam via the London office, not Americans. Query, why are we paying then? TO keep them servicing our ever bigger deficits? Making good on promises mortgage derivatives were government backed?