"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 bullshit. What you have to understand is that these regulators have ultimate power....
When AIG finally blew up, the OTS regulator ostensibly in charge of overseeing the insurance giant - a guy named C.K. Lee - basically admitted that he had blown it. His mistake, Lee said, was that he believed all those credit swaps in Cassano's portfolio were "fairly benign products...
Market analyst Eric Salzman is more blunt. "If AIG went down," he says, "there was a good chance Goldman would not be able to collect." The AIG bailout, in effect, was Goldman bailing out Goldman. Eventually, Paulson went a step further, elevating another ex-Goldmanite named Edward Liddy to run AIG...
"Has that ever happened?" Grayson asked. "Have people ever said, 'We will not take your $100 billion because people will find out about it?'"
"Well, we said we would not publish the names of the borrowers, so we have no test of that," Kohn answered,...
...it's AIG's rip-roaringly shitty business model writ almost inconceivably massive - to echo Geithner, a huge, complex global company attached to a very complicated investment bank/hedge fund that's been allowed to build up without adult supervision. How much of what kinds of crap is actually on our balance sheet, and what did we pay for it? When exactly will the rent come due, when will the money run out? Does anyone know what the hell is going on? And on the linear spectrum of capitalism to socialism, where exactly are we now?
Matt Taibbi
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Well, I never get tired of reading this stuff. I love it. Thanks.
It also notes the activities of Phil Gramm, but fails to mention while Phil was cooking deregulation, his wife was on the board of directors for UBS. And, that is where Gramm went to work after he quit the US Senate. For those who forgot UBS:
``UBS AG (NYSE: UBS; SWX: UBSN; TYO: 8657) is a diversified global financial services company, with its main headquarters in Basel and Zürich, Switzerland. It is the world's largest manager of private wealth assets, "the world's biggest manager of other people's money"[1] and is also the second-largest bank in Europe...''
http://en.wikipedia.org/wiki/UBS_AG
These stories, these plots, games and swindles are so interlocked with the webs of power, wealth, and government and so complexly nuanced into ideological bullshit that they can't be dreamed up. The most overwrought fiction pales against the arabesque tapestry of the real. One of Capitalism's finest moments in centuries.
CG.