Little noticed here was the Sunday report in the NYT of how Treasury Secretary Paulson's bailout of AIG is connected to his former firm Goldman Sachs. Turns out that the failure of AIG would have cost Sachs $20 billion.
But following a meeting between Paulson and Goldman Sach's CEO Lloyd Blankfein, AIG was saved.
Here is what Chris Martenson notes:
1. Only one Wall Street executive was in the war room, and he was from Goldman Sachs (GS), the firm Paulson headed up before becoming Treasury Secretary.
2. Lehman, with whom GS did not have an overly large trading position, was allowed to go under.
3. AIG, with whom GS did have a large position, was handed an $85 billion handout.
That was sure convenient!
Some kind of bailout is probably needed. But it should have real oversight, true CEO caps on CURRENT CEO contracts, and a funding mechanism like a stock transaction fee.
By Arjuna's diary of Daily Kos.
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Comments
#1 You were 100% right
You were correct. Now that a bit of daylight has crept into the deal, it's pretty clear that Paulson wrote Goldman Sachs a $20B check for an asset worth nothing. That check came from American Taxpayers. I don't think your average American is going to be happy when they finally understand what's happened.