Yield Curve – difference between interest rate of borrowed money versus the interest rate earned on the same money lend out.
Essentially, AIG was allowed to hide a hedge fund in a solid insurance business.
AIG was a hybrid company hiding from different government agencies and was allowed to create exotic financial products went unregulated and therefore selected by economic terrorist to be used as a weapon of mass destruction.
Enormous risks were allowed to built up hidden from the American public within its four walls which once triggered will allow vast wealth to be transferred from the American people to these yet to be identified terrorists.
According to the Ray De Lorenzi, American Association for Justice at Justice.org: “…The Starr Foundation is one of the largest foundations in the United States. It is chaired by Hank Greenberg, CEO of AIG until 2005. AIG gave $23 million to U.S. Chamber through the Starr Foundation to push anti-regulatory efforts. The majority of this money, $15 million, was pledged in 2003 immediately after the passage of Sarbanes-Oxley to initiate a “capital campaign for educational and research programs.” Effectively, this money was to begin setting the groundwork to roll back post-Enron reforms…”
The money was given from Starr to U.S. Chamber’s own foundation, which freely moves money to the corporate arm. Of U.S. Chamber’s 17 foundation grants, seven came from a variety of corporations totaling $2.2 million. The remaining 10 grants to U.S. Chamber, equaling $24.25 million, all came from Greenberg and the Starr Foundation.15
Democratic House Representative Alan Grayson of 8th District Florida notice that AIG may need $500 billion more if yield curve moves by 1%. See video # 1 below.
AIG 2008 10K filing with SEC reveals this in plain sight but Bernanke and Geithner makes no mention of it to the American Taxpayer who owns AIG despite receiving the recent stress test results.
Bernanke and Paulson go before Congress and asks Congress for $700 billion and creates TARP which AIG takes $40 billion.
Geithner arranging additional lending facilities to AIG of $30 billion.
AIG has $1.6 trillion to “unwind” according to AIG CEO Liddy. But these are really paper losses. It’s not like AIG sold oranges and the oranges are rotten have to be thrown away. So where are all these hundreds of billions going? Watch video #2 of Democratic House Representative Carolyn Malony from New York’s 14th District. She says it’s going to foreign countries. Now how are foreign governments “systemic risks” to the United States? Sounds fishy? You betcha’!!! So why was the US Congress and the American Taxpayer rushed into this bailout strategy using “fear and scare” propaganda since Sep 2008? Hmmm…
Once again House congressional leaders are off target (both Democrats & Republicans). Meet the mastermind behind the AIG unit that current AIG Chairman & CEO Liddy is getting bashed for. Personally, I don’t see how a guy who worked along Milken of Drexel Burhnam Lambert who was arrested for fraud, be allowed to sell products and services without strong oversight and regulation.
Joseph J. Cassano and a over a couple of dozen staff from his AIG business division brought down the United States financial system and possibly the World.
BEHIND INSURER’S CRISIS, A BLIND EYE TO A WEB OF RISK
The insurance giant’s London unit was known as A.I.G. Financial Products, or A.I.G.F.P. It was run with almost complete autonomy, and with an iron hand, by Joseph J. Cassano, according to current and former A.I.G. employees.
A onetime executive with Drexel Burnham Lambert — the investment bank made famous in the 1980s by the junk bond king Michael R. Milken, who later pleaded guilty to six felony charges — Mr. Cassano helped start the London unit in 1987.
The unit became profitable enough that analysts considered Mr. Cassano a dark horse candidate to succeed Maurice R. Greenberg, the longtime chief executive who shaped A.I.G. in his own image until he was ousted amid an accounting scandal three years ago.
But last February, Mr. Cassano resigned after the London unit began bleeding money and auditors raised questions about how the unit valued its holdings. By Sept. 15, the unit’s troubles forced a major downgrade in A.I.G.’s debt rating, requiring the company to post roughly $15 billion in additional collateral — which then prompted the federal rescue.
Mr. Cassano, 53, lives in a handsome, three-story town house in the Knightsbridge neighborhood of London, just around the corner from Harrods department store on a quiet square with a private garden.
He did not respond to interview requests left at his home and with his lawyer. An A.I.G. spokesman also declined to comment.
Clearly AIG’s CEO, Board of Directors and its senior executives have no concept of reality. The company is 80% owned by the US taxpayers and AIG runs like it’s their private golf club and spa.
Let’s tally up the facts.
AIG
Former AIG CEO MauriceGreenberg spends $20 million of AIG money on US Chambers to lobby Congress for deregulation post Enron and turns AIG into an international hedge fund according to American Association for Justice case study.
In 2008, over $112,000 of campaign contributionwas given to the Obama Presidential campaign by AIG employees according to OpenSecrets.org
In 2008, over $73,000 of campaign contribution was given to Chris Dodd’s campaign by AIG employees according to OpenSecrets.org
In 2008, over $44,000 of campaign contribution was given to Hillary Clinton’s campaign by AIG employees according to OpenSecrets.org
Federal Reserve Bank in September of 2008 under Bernanke lends insolvent AIG $85 billion with White House and Treasury Secretary Paulson support.
AIG has access to various other lending facility including $40 billion of TARP that brings the total to $165-175 billion as of March 2009
In March 2009, Bernanke admits being frustrated by AIG problems as AIG reports $62 billion loss in most recent quarter of operations and over $100 billion in 2008 making it the worst lost in US Corporate history.
AIG reveals $12.9 billion was paid to Goldman Sachs using Federal taxpayer money due to CDS obligations. Former Treasury Secretary Hank Paulson was the former CEO of Goldman Sachs.
Bonus of $165 million is to be paid to AIG executives making 73 of its employees (past or present) of the business division responsible for massive financial losses instant millionaires. A total of $450 million is to be paid to various employees (past or present) for 2008 performance despite the company lack of financial viability.
Average Taxpaying American
US job loss in 2008 is net 2.6 million
US job loss in 2009 at 22,135 per day or 1.3 million as of end of Feb.
Foreclosures nationwide are at all time high according to Sacramento, Calif.-based Foreclosures.com. The company said 121,756 foreclosures were completed nationwide in Feb ‘09, up from 72,694 in Jan and the previous high of 104,243 in Sep ‘08
U.S. household wealth falls $11.2 trillion in 2008 according to Federal Reserve data.
