Watching the AIG testimony for the second time

Every time I watch this I get more out of it. This time Marcy Kaptur stood out in her strong advocacy for the American worker. Rep Kaptur - you have my support - go after them and bring out the TRUTH. You are so right in how wall street and corporate America has decimated mid America and the small towns across the country. We as a people are ashamed of how we have supported them throughout the years.

Tim Ryan and the SIFMA role in bailouts

From reading the documentation the Judicial Watch obtained I wonder what role Tim Ryan from SIFMA.org played in the government funding of the 9 large banks. SIFMA (Securities Industry and Financial Markets Association) is a major lobby for the securities industry and large banks. Why or how they were involved with the federal infusion of money into the banks is beyond me. You can be sure that they DON'T have the taxpayers interest in mind.


We may never know the truth, as the government has redacted most of the documents released under the FOIA request:


I hope that these industry lobby groups are looked at during the coming years as we determine how we fell so low.

AIG forced by Federal Reserve to pay all CDS contracts at 100% - way above current value at the time of settlement.

I have yet to see this on the MSM – but Karl Denninger picked it up as covered on CSPAN.

AIGs CEO Liddy answered a question posed by Rep Kaptur:

"When The Fed set up Maiden Lane they took on responsibility for settlement of all of the CDS."

"The Federal Reserve decided we should pay 100 cents on the dollar",

Rep Issa expanded the truth of this in a followup - they could have purchased those contracts for far less in the open market at the time.

"AIG repaid counterparties one to one, dollar for dollar, but when it comes to teachers and firefighters in Ohio, [they got] zero," Kucinich said. "This is not acceptable, Mr. Liddy. I'm not going to let you get away with it."

Rep Issa called the three-member board from the NY Fed that oversees the government’s 80% ownership stake in AIG "an unconstitutional and unaccountable entity."

As Mr. Denninger says: “The bottom line is that the testimony was that The Fed decided to settle the contracts in a non-economic manner that resulted in screwing the taxpayer by transferring more than $100 billion dollars of taxpayer money out to these banks when the cash value at the time was FAR LESS.”

This is the ONLY reason that the large banks have reported large first quarter profits.

Mr. Denninger continues: “The allegation just made by Liddy is that Bernanke and The Fed literally stole $100 billion dollars from you and I by intentionally and wantonly overpaying on the settlement of these contracts!”

AIG is fighting all requests from the congress: "AIG has spent millions of dollars on high-priced P.R. firms and big-time lawyers to attack its critics," Rep. Towns said. "Clearly, AIG is making sure its lawyers and PR firms are watching its back."

naked capitalism: Federal Reserve Inspector General Unable to Answer Basic Questions on Where the Trillions Went

The oversight of the fed is severely lacking. It is outrageous that they can have taken on Trillions of non treasury related securities but either don't know or won't tell on their current status.

naked capitalism: Federal Reserve Inspector General Unable to Answer Basic Questions on Where the Trillions Went: "Federal Reserve Inspector General Unable to Answer Basic Questions on Where the Trillions Went
Rep. Alan Grayson asks Inspector General Coleman of the Federal Reserve some very basic questions of about various Fed programs and activities and gets nowhere. And the worse is that the IG isn't stonewalling, but instead is clearly completely clueless. Watching the video, you get the impression that Coleman can't name a program beyond the TALF.

But there is a possibly more important issue at stake. The interview is with the Inspector General of the Federal Reserve Board of Governors. The programs are actually at the Federal Reserve Bank of New York. For reasons I cannot fathom, the Board of Governors is subject to Freedom of Information Act requests, while the Fed of New York has been able to rebuff them."

Troubled banks must be allowed a way to fail

Finally some common sense! Hoenig needs to be put in charge of the Fed.

FT.com / Comment / Opinion - Troubled banks must be allowed a way to fail:

"Troubled banks must be allowed a way to fail
By Thomas Hoenig
Published: May 3 2009 19:01 Last updated: May 3 2009 19:01
When the
financial crisis began to unfold in 2007, US policymakers reacted quickly out of
fear that rapidly evolving events would lead to a global economic collapse. In
my view, the policy response to this point has been ad hoc, resulting in
inequitable outcomes among firms, creditors, and investors. Despite taking a
number of actions to stabilise markets and institutions, uncertainty continues
and markets remain stressed.
I believe there is an alternative method for
addressing this crisis that deals more effectively with the issues we currently
face while also considering the long-run consequences of those actions: the
implementation of a systematic plan to resolve large, problem financial
institutions."

The deceptive nature of Large Numbers

When President Obama recently announced that they would be finding savings of one hundred million here, one hundred million there to cut costs in the federal budget, many were impressed.

On the other hand, that is is like an average American family cutting two dollars out of their yearly budget - not very hard to do.

Institution: Average Family
Yearly Budget: $40,000.00
Yearly Savings: $2.00
% savings: 0.005%

Institution: Federal Government
Yearly Budget: $2,000,000,000,000.00
Yearly Savings: $100,000,000.00
% savings: 0.005%

When our government has it's budget in the Trillions of dollars, a hundred million dollars is NOTHING!

UAW takes over Chrysler in hostile takeover

This is one big political payback. I will never buy a Chrysler or GM car until the companies are turned back over to their rightful creditors.