In a report (pdf) titled “Factors Affecting Efforts to Limit Payments to AIG Counterparties”, Neil Barofsky, special inspector for TARP, wrote that the “negotiating strategy to pursue concessions from [AIG] counterparties offered little opportunity for success, even in the light of the willingness of one of the counterparty to agree to concessions”.
He also concluded that the “structure and effect of the FRBNY’s assistance to AIG … effectively transferred tens of billions of dollars of cash from the government to AIG’s counterparties”.
Those counter parties are, of course, the banksters. This was our money which a compromised and corrupt NY Fed gave to the banksters when they didn’t have to. Among the banks receiving such largesse were, of course, Goldman Sachs.
The then head of the NY Fed, a former Goldman chair, immediately bought 50,000 shares of Goldman and made $5 million. The ensuing uproar forced him to resign. But he was not indicted. And in my opinion should have been.
As Sen. Dorgan says, the system is rigged. We need a new one.