This is all over financial blogs this morning. The chief beneficiary here was Goldman and the other investment banks.
This latest revelation confirms the Fed’s commitment to secrecy and, although troubling, at this point should come at no surprise. The most important element is that AIG itself determined it should provide information about its swaps transactions (the ones it settled at 100 cents on the dollar at the New York Fed’s instigation and approved by Geithner) because it was an SEC required disclosure. Thus the Fed required AIG to violate SEC regs. The clear intent was to hide the extent of the subsidies that flowed from the Fed and Treasury to the recipient banks (recall AIG also received TARP funds). Charming.
Geithner should be fired then indicted.