Restart Those "Geithner Goes" Office Pools

Whoever, in the first round, got a date in 2010, for when Secretary of the Treasury Timothy Geithner takes a hike, forced or otherwise, may be looking a bit more optimistic today;



Geithner’s New York Fed Told AIG to Limit Swaps Disclosure Share Business Exchange

The Federal Reserve Bank of New York, then led by Timothy Geithner, told American International Group Inc. to withhold details from the public about the bailed-out insurer’s payments to banks during the depths of the financial crisis, e-mails between the company and its regulator show.

AIG said in a draft of a regulatory filing that the insurer paid banks, which included Goldman Sachs Group Inc. and Societe Generale SA, 100 cents on the dollar for credit-default swaps they bought from the firm. The New York Fed crossed out the reference, according to the e-mails, and AIG excluded the language when the filing was made public on Dec. 24, 2008. The e-mails were obtained by Representative Darrell Issa, ranking member of the House Oversight and Government Reform Committee.

The New York Fed took over negotiations between AIG and the banks in November 2008 as losses on the swaps, which were contracts tied to subprime home loans, threatened to swamp the insurer weeks after its taxpayer-funded rescue. The regulator decided that Goldman Sachs and more than a dozen banks would be fully repaid for $62.1 billion of the swaps, prompting lawmakers to call the AIG rescue a “backdoor bailout” of financial firms.

“It appears that the New York Fed deliberately pressured AIG to restrict and delay the disclosure of important information,” said Issa, a California Republican. Taxpayers “deserve full and complete disclosure under our nation’s securities laws, not the withholding of politically inconvenient information.”

Oh, Timmy, you didn't do that ...

Oh, Timmy, Timmy, Timmy ...

There's little refuge out there, Timmy.

Henry Blodget;

Bloomberg unearths more details on the nauseating bailout of AIG and the 100-cents-on-the-dollar payouts to Goldman, et al.

Once again, Tim Geithner was in charge.

Barry Ritholtz;

Between Summers and Geithner, it appears that President Obama has made the exact same mistake that one George W. Bush did: Instead of filling his administration’s most important posts with his own people, he reached back to prior admins (Cheney, Rumsfeld, etc) and loaded up on incompetent retreads.

Barack W. Obama indeed . . .

Felix Salmon points out another fact that Timmy, probably, would like to bury;

Michael Corkery also points out that all of this secrecy coincided with Geithner’s nomination to be Treasury secretary, which makes the whole thing stink much more: was Geithner deliberately trying to keep anything potentially damaging secret for the sake of his own personal career progression?

And, Edward Harrison, writing on Naked Capitalism, just lets it all out;

Let me add a few words to Yves’ last post because I don’t think she was explicit enough about what’s going on here. This was looting and a cover-up plain and simple.

[snip]

He was on the job when these firms levered up and took reckless risks that endangered our financial system. For him to absolve himself of responsibility is a disgrace. And to add insult to injury, we now learn that he urged a systemically important company to withhold evidence of his looting of taxpayers.

Tim Geithner must go

Now, we wait, to see what Congress does, and if they will go after Geithner, and, for that matter, Heistin' Hank Paulson, for their total scam rip-off of the Treasury, the citizens, the country.

And, for those holding squares, say, in Spring (the Obama White House will want to get this off the radar well before the Fall Midterms), you're sitting pretty ...


Bonus Riffs

Susie Madrak: Geithner to AIG: Let's Keep This Under Our Hat, Okay?

Cynthia Kouril: Geithner’s New York Fed Ordered AIG to Violate Securities Law in 2008

Breaking! ... Obama Takes Action, Siezes AIG's March Madness Office Pools and Brackets

Blame?

This Didn't Make The 11PM News ...

Greed Has A Name ...

And, In The "Fuck You Very Much" Department ...

If Digby had her way, she would call it, simply, hubris.



New Chief at A.I.G. to Be Paid at Least $7 Million a Year

How much will it cost the American International Group to keep its chief executive to help stabilize the troubled insurer? At least $7 million a year.

A.I.G. disclosed Monday in a regulatory filing that it would pay Robert H. Benmosche, 65, the former head of MetLife, $3 million a year in cash and $4 million in stock.

Mr. Benmosche will also be eligible for up to $3.5 million in stock as part of an incentive plan, A.I.G. said in a regulatory filing.

[snip]

A.I.G. said in its letter formally offering Mr. Benmosche the job that his compensation would be subject to “clawbacks” by Mr. Feinberg’s office, meaning that at least some of the money could be recovered if the bonuses were paid based on financially misleading data. Mr. Benmosche will also not receive a severance package if he is dismissed from the company, according to the regulatory filing.

Oh, "clawbacks" ... That may be too harsh, right?

I mean, AIG, and "financially misleading data ...

I'm sure we have absolute no worries there ...

And, there is this gem;

This month, A.I.G. reported its first quarterly profit since 2007, though Mr. Liddy warned that the insurance businesses “remain challenged.”

Really?

AIG has paid back all the money, the billions-upon-billions, given to them by the U.S. Government, and still made a profit?

How come that wasn't in screaming headlines?

Yeah, the insurance business may remained "challenged", but with the Obama Financial Team (Ruben and, of course Secretary of the Treasury Tim "What's that, Lassie? (Woof, woof!!) Timmy Geithner's in the well?!!" Geithner), at the helm, there's no worry.

A bailout, simply, is just around the corner.

And, when we want to look into the "Clueless Corner", Yves Smith, over on Naked Capitalism, had this;

Tim Duy pointed out this priceless remark from AIG's new CEO, Robert Benmosch:

Benmosche told employees that he “had the luxury to say to the government, I’m not going to rush to do this. I’m appalled at how much pressure has been put on all of you to just sell it no matter what, because the Fed wants out, or the Treasury wants out. If they want out in a hurry, they shouldn’t have come in in the first place.”

This ought to be rather interesting to watch.

That is, how soon into the "Benmosch Dynasty", does AIG come whimpering to Washington again, begging for money.


Bonus AIG Riffs

Dennis Overbye: They Tried to Outsmart Wall Street

Larisa Alexandrovna: AIG = BCCI

Eliot Spitzer: The Real AIG Scandal - It's not the bonuses. It's that AIG's counterparties are getting paid back in full

Paul Krugman: AIG

Michael Lewis: The Man Who Crashed the World

Zachary Roth and Ben Buchwalter: The Rise And Fall Of AIG's Financial Products Unit

Breaking! ... Obama Takes Action, Siezes AIG's March Madness Office Pools and Brackets