Sunday, March 29, 2009

And You Shall Know Their Names

Somewhere in a lavish flat just outside of Harrods in London, one man hides out having managed to scrape millions of dollars off the AIG mess -- and he could be the single most important player that ripped a gaping hole in the financial universe that will take years to heal... if it ever does.

If you have a really strong stomach and want to take an insider's peek into what really happened at AIG, this article from The Rolling Stones is a must read:
"There's this notion that the regulators couldn't do anything to stop AIG," says a government official who was present during the bailout. "That's bullsh*t. What you have to understand is that these regulators have ultimate power. They can send you a letter and say, 'You don't exist anymore,' and that's basically that. They don't even really need due process. The OTS could have said, 'We're going to pull your charter; we're going to pull your license; we're going to sue you.' And getting sued by your primary regulator is the kiss of death."
WARNING -- there is extremely vulgar language in the article referenced below. It is DEFINITELY Triple R rated and NOT for the faint hearted.

It names names.

It points out the one Government body that could have stopped the insanity.

And it explains, in great detail, why other Government bodies COULD NOT stop the eventual explosion (and potential collapse?) of our financial universe.

If you are like me, wanting to know the deeper stories, the stories behind the stories, unravel the mysteries of the universe... then grab a cup of coffee, sit back and be prepared for a VERY LONG READ of this remarkable article exposing more than you could think possible. [LINK]

And after the crash... who was in on the private meetings?

Let's see.... we have a fellow by the name of Geithner. We also have another by the name of Paulson (who looked in from time to time). Oh, and lookey-here... is that Blankfein, the CEO of Goldman Sachs?

Hmmmm... and what do all three of them have in common?

And shucky-darn, the whole "crisis" came to the table at the precise moment in financial history that it was decided to let Lehman fall off a cliff. Coincidence?

This little quote half-way through the article caught my attention:
The bonuses are a nice comic touch highlighting one of the more outrageous tangents of the bailout age, namely the fact that, even with the planet in flames, some members of the Wall Street class can't even get used to the tragedy of having to fly coach. "These people need their trips to Baja, their spa treatments, their hand jobs," says an official involved in the AIG bailout, a serious look on his face, apparently not even half-kidding. "They don't function well without them."
But I digress.

Back on point, namely naming names.

Which politicians do you think might have been lobbied hard (complete with lavish campaign contributions) to allow all of the shenanigans to take place in the first place?

Names practically leap off the page:
In 1997 and 1998, the years leading up to the passage of Phil Gramm's fateful act that gutted Glass-Steagall, the banking, brokerage and insurance industries spent $350 million on political contributions and lobbying. Gramm alone — then the chairman of the Senate Banking Committee — collected $2.6 million in only five years. The law passed 90-8 in the Senate, with the support of 38 Democrats, including some names that might surprise you: Joe Biden, John Kerry, Tom Daschle, Dick Durbin, even John Edwards.
And just wait until you find out which one of the financial behemoths scored a bundle by "shorting" the housing markets. To me, this whole thing smells of insider trading, but I'm neither a lawyer nor a financial wizard. I'm just a hard working, tax paying work at home mom shaking my head and wondering just HOW in the WORLD can they all just walk away with none of the key players getting locked away?

Instead, they all just get a free pass thanks to you and me?

How many "Goldmanites" are involved in this whole AIG thing? For that, you'll have to read the article. You'll be simply amazed at the maze -- and you might think, rightly so, that it really wasn't AIG that we were bailing out.

And for all of you still drinking koolaide thinking we now live in a nation with total Government transparency, I leave you with this "food for thought" from the article:
If you look at the weekly H4 reports going back to the summer of 2007, you start to notice something alarming. At the start of the credit crunch, around August of that year, you see the Fed buying a few more Repos than usual — $33 billion or so. By November, as private-bank reserves were dwindling to alarmingly low levels, the Fed started injecting even more cash than usual into the economy: $48 billion. By late December, the number was up to $58 billion; by the following March, around the time of the Bear Stearns rescue, the Repo number had jumped to $77 billion. In the week of May 1st, 2008, the number was $115 billion — "out of control now," according to one congressional aide. For the rest of 2008, the numbers remained similarly in the stratosphere, the Fed pumping as much as $125 billion of these short-term loans into the economy — until suddenly, at the start of this year, the number drops to nothing. Zero.

The reason the number has dropped to nothing is that the Fed had simply stopped using relatively transparent devices like repurchase agreements to pump its money into the hands of private companies. By early 2009, a whole series of new government operations had been invented to inject cash into the economy, most all of them completely secretive and with names you've never heard of.
I meant to come and tell you about "Lights Out" from yesterday. And I meant to maybe update you on a few tea parties happening across the nation. And I meant to tell you about the big protests gearing up in London. And I meant to tell you about "papering" a room. And I meant to finish researching info for my "made for tv" script that I'm planning to pen in April.

And then I found -- and read -- the article.

Okay, maybe I wouldn't have been quite so disgusted by what I discovered in the article above if I hadn't already discovered this little gem of an article before it: "Did Goldman Goose Oil?"

You'll see some familiar names in that article, too, such as: Citibank, Merrill Lynch and especially Goldman Sachs.

And, like the author of the news article, you might be guessing how the gas prices managed to spike so high just when the elections of 2008 were heating up. If it's true, then we... dear voters and taxpayers ...were "bamboozled" once again, by many of the same players still pulling from our coffers.

If someone, somewhere, doesn't go to jail over that fiasco, then it proves beyond a shadow of a doubt --- well, you decide. You tell me, in the comments, what you think it proves unequivocally.

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