AIG Derivatives Guys: Just Do It (Seppuku)

I have a solution to this problem; it is found in the use of this device - not as an act of assault by someone else upon you, but by you upon yourself. The Taxpayers will thank you; nobody likes a whiner, especially when it really IS your fault.

Had Enough FRAUD America?

Cut the crap Mr. President, Mr. Geithner and Congress. You are lying and this entire "bonus" game is a smokescreen to try to divert attention from the real theft - nearly $100 billion dollars of taxpayer money that has gone to Goldman and other banks, including foreign banks, to pay off Credit Default Swaps written by AIG that were worthless as the company had no capital behind them. This in turn means that the accounting of these firms has in fact fraudulently overstated earnings - perhaps for years - and still is!

The Fed, OTS and OCC have and had jurisdiction over American banks that bought these products, and were clearly derelict in their duty to prevent these regulated entities from purchasing these CDS from a firm that was unable to prove capital adequacy to cover its bets.

Finally, TurboTimmy, it is not acceptable for you to simply "deduct" the amount of the bonuses from AIG's "aid package". Uh uh. This entire bonus question is a smokescreen for the massive conflicts of interest where an investment bank buys billions of dollars of "credit protection" from a company, then the CEO goes to work for Treasury and makes sure those contracts are good by siphoning off money from the taxpayer to cover them when the seller turns out to be insolvent.

The Real AIG Scandal

Everybody is rushing to condemn AIG's bonuses, but this simple scandal is obscuring the real disgrace at the insurance giant: Why are AIG's counterparties getting paid back in full, to the tune of tens of billions of taxpayer dollars?

The AIG bailout has been a way to hide an enormous second round of cash to the same group that had received TARP money already: Goldman, Bank of America, Merrill Lynch, UBS, JPMorgan Chase, Morgan Stanley, Deutsche Bank, Barclays, and on it goes.

The appearance that this was all an inside job is overwhelming. AIG was nothing more than a conduit for huge capital flows to the same old suspects, with no reason or explanation.

Caterpillar announces 2,200 job cuts

Caterpillar gearing down production further in response to eroding global demand, disclosed plans Tuesday to idle more than 2,200 U.S. workers, including 1,526 in Illinois.

The Banks are totally bankrupt

The chart below shows the assets versus liabilities for four major banks. These figures are from the Comptroller of the Currency and clearly indicate these banks’ dire situation due to overextending themselves in credit default swaps, derivatives and other toxic loans. These four banks alone account for nearly $179 trillion of toxic debt and downside liabilities and yet their total asset value is only $4.5 trillion. Furthermore, many of these assets are still over-valued. This means that each of these institutions is virtually bankrupt. There is not enough money in the civilized world to pay off all of these debts. Giving taxpayer money to bail out these banks’ liabilities is tantamount to fraud.

During the TARP oversight by the Fed’s Ben Bernanke and the Treasury’s Henry Paulson, not once were the banks seeking a government bailout required to reveal actual and potential liability portfolios. If this had been done, and if American voters were made fully aware of our financial institutions’ true accounts, the original $700 billion package would have been rejected outright. Instead, the American public has been sucker-punched. And the gang who orchestrated the current meltdown are again steering the sinking vessel to remedy the crisis.

Assets vs. Derivatives and Credit Default Swaps (CDS)
for Four Leading Banks

Chart is represented in Millions

Bank	Assets	Derivatives	Credit Default Swaps	Total Liabilities
J.P. Morgan Chase	$1,768.657	$87,688.008	$9,177.731	$96,865.739
Citigroup	$1,207.007	$35,645.429	$2,939.783	$38,585.212
Bank Of America	$1,359.071	$38,673.967	$2,480.672	$41,154.639
HSBC	$181.587	$4,133.712	$1,152.948	$5,286.660

Americans voted for progressive change that would remove the United States from Iraq, roll back past administrations’ favoritism towards the corporate and financial oligarchies, and for a proactive reinvigoration of life on Main Street. The United Nations and other multinational forces—with America’s assistance—can deal with the Afghanistan crisis. Just by exiting these two war zones alone, American taxpayers would save between $5 and $10 billion per month. Nobel laureate economist Joseph Stiglitz’s thorough analysis of America’s war costs in Afghanistan and Iraq is now estimated at over $3 trillion.