AIG's "Best and Brightest"? Try Dumb and Dumbest
by Maura Kelly via talya 2009-03-18 22:26:27

The top guys at AIG are trying to cheat honest taxpayers out of their money.

You don't have to be a financial expert to appreciate the irony in the letter that Edward Liddy, the government-appointed chairman of AIG, sent to Treasury secretary Timothy Geithner on Saturday.

To explain why bonuses of $165 million were needed to keep the top guys at the insurance giant, Liddy wrote: "I do not like these arrangements and find it distasteful and difficult to recommend to you that we must proceed with them." And yet, he said, "We cannot attract and retain the best and the brightest talent to lead and staff the AIG businesses -- which are now being operated principally on behalf of American taxpayers -- if employees believe their compensation is subject to continued and arbitrary adjustment by the U.S. Treasury."

The best and the brightest, huh? We are talking about the dudes at AIG's financial products division, which helped effect the sub-prime mortgage crisis and to nearly level the global economy too. (Until February 2008, the division was headed up by Joseph Cassano, named by CNN as one of the "Ten Most Wanted Culprits" of the financial collapse.) And yet there are some of Cassano's remaining colleagues, receiving individual bonuses as large as $6.5 million.

AIG defended its action by saying the bonuses were promised last year, in contracts, and cannot be legally voided at this point. Lawyers at the Treasury department have agreed that the company would likely face lawsuits if it tried to refuse the bonuses. Fair enough, I suppose. But considering that AIG agreed to reduce its 2009 bonuses for the unit by 30% after being pressured by Liddy, I have to wonder if there isn't a lot more wiggle room. That dude who is getting $6.5 million, for instance: surely he'd stay on for a measly $5 million? Especially considering there can't be too many more jobs waiting for him out there in the financial world he helped to nearly destroy.

Moreover, if AIG had been allowed to fail, would it still have been legally obligated to pay these bonuses? And why didn't the government foresee that this might happen and insist on a bonus cap as a condition of AIG's bailout? Surely the company would have had to accept. That the government didn't take such a simple measure to prevent this kind of gross abuse seems wildly short-sighted, and unbelievably daft.

But I don't think it's the government that's primarily to blame here. I do believe they bailed out AIG with the best intentions -- knowing they'd have to face angry voters (and the unforgiving annals of history) if the economic disaster got even worse. It's those "best and brightest" over at AIG who are really to blame. It's a shame that those jerks don't have to answer to anything -- not even (if their continued greed is any indication) their consciences. But what they're doing -- cheating honest taxpayers out of their money -- isn't all that far removed from what Bernie Madoff did.

There is some consolation, however, in the words of President Obama, who called the AIG bonuses an "outrage" and instructed Geithner to "pursue every single legal avenue to block these bonuses and make the American taxpayers whole." We can always hope that happens. Too bad there's not much we can do if it doesn't.

Copyright applies.

http://www.alternet.org/story/131939/

Deleted YouTube videos
by Cleaves Editorial Team 2009-03-19 09:21:11

We apologise for a number of Google controlled 'YouTube' videos no longer running. We would like to emphasize that all YouTube videos are controlled by Google, which has a less than acceptable record working with tyrannical governments to suppress information and informing 'authorities' on the search patterns of innocent citizens who take a stand against oppression.

Google has never been a friend to this site; probably due to a number of articles warning of Goolge's push to control the free flow of information -- the video deletions are perfect examples of this very nasty Big Brother attitude!

More such behaviour from Google will no doubt prompt the development of a people's search engine or other FREE and FAIR information resource.

WE CANNOT EMPHASISE ENOUGH THAT GOOGLE IS THE ENEMY OF FREE SPEECH AND EXPRESSION; FURTHERMORE, ITS RECORD OF SELECTIVELY SUPPRESSING INFORMATION BUT GIVING USER DETAILS TO (CHINESE) GOVERNMENTS, WHICH HAS LED TO THE IMPRISONMENT AND IN SOME CASES EXECUTION OF (CHINESE) FREEDOM FIGHTERS, brands Google a heinous and very dangerous organisation.

The video deleted from the above post named CEOs and executives and listed the pay they had appropriated from taxpayer rescue funds. THE TAXPAYER HAS A RIGHT TO KNOW WHO IS RECEIVING THEIR MONEY WE WOULD THINK! ANY ATTEMPT BY ANYONE TO SUPPRESS THIS INFORMATION LABELS THEM CLEARLY AS ENEMIES OF THE PEOPLE -- ARE YOU READING THIS GOOGLE? THE MORE YOU CENSOR INFORMATION THE GREATER YOUR CREDIBILITY LOSS.

The information contained in the deleted vids is freely available in the public domain so deletion is entirely a Google decision!

It is extremely important that everyone becomes aware of the companies which define themselves as servants of corrupt and criminal ruling elites and as enemies of the people.

To compensate for the deleted vids the Cleaves Editorial Team offers the following; just how long it will survive under present conditions is anyone's guess!

Fed Lends 2 Trillion Of Tax Payers Money To More Banks

Treasury's toxic asset plan could cost [an ADDITIONAL] $1 trillion!
by Martin Crutsinger 2009-03-22 22:21:57

WASHINGTON (AP) — The Obama administration's latest attempt to tackle the banking crisis and get loans flowing to families and businesses will create a new government entity, the Public-Private Investment Program, to help purchase as much as $1 trillion in toxic assets on banks' books.

The new effort, to be unveiled Monday, will be followed the next day with release of the administration's broad framework for overhauling the financial system to ensure that the current crisis — the worst in seven decades — is not repeated.

A key part of that regulatory framework will give the government new resolution authority to take over troubled institutions that would pose a threat to the entire financial system if they failed.

Administration officials believe this new power will save taxpayers money and avoid the type of controversy that erupted last week when insurance giant American International Group paid employees of its troubled financial products unit $165 million in bonuses even though the company had received more than $170 billion in support from the federal government.

Under the new powers being sought by the administration, the treasury secretary could only seize a firm with the agreement of the president and the Federal Reserve.

Once in the equivalent of a conservatorship, the treasury secretary would have the power to limit payments to creditors and to break contracts governing executive compensation, a power that was lacking in the AIG case.

The plan on toxic assets will use the resources of the $700 billion bank bailout fund, the Federal Reserve and the Federal Deposit Insurance Corp.

The initiative will seek to entice private investors, including big hedge funds, to participate by offering billions of dollars in low-interest loans to finance the purchases. The government will share the risks if the assets fall further in price.

When Geithner released the initial outlines of the administration's overhaul of the bank rescue program on Feb. 10, the markets took a nosedive. The Dow Jones industrial average plunged by 380 points as investors expressed disappointment about a lack of details.

Christina Romer, head of the Council of Economic Advisers, said Sunday that it's important for investors to know that the administration is bringing a full array of programs to confront the problem.

"I don't think Wall Street is expecting the silver bullet," she said on CNN's "State of the Union." "This is one more piece. It's a crucial piece to get these toxic assets off, but it is just part of it and there will be more to come."

But private economists said investors may still have doubts about whether the government has adequate resources to properly fund the plan and whether private investors will be attracted to participate, especially after last week's uproar concerning the AIG bonuses, which has added to the anti-Wall Street feelings in the country.

Romer said the new toxic asset program would utilize around $100 billion from the $700 billion bailout fund, leaving the fund close to being tapped out.

Mark Zandi, an economist at Moody's Economy.com, estimated that the government will need an additional $400 billion to adequately deal with the toxic asset problem, seen by many analysts as key to finally resolving the banking crisis.

Administration officials, who briefed reporters late Sunday night, said no decision had been made on asking Congress for more money at the present time.

These officials, who spoke to reporters on condition of anonymity because the plan had not yet been released, said the goal was to prove that the asset purchase program could achieve success with the resources available to it.

In its budget request to Congress last month, the administration included a placeholder for an additional $750 billion in bailout funds, but many lawmakers said there was little chance more money will be approved, given the current political environment.

Zandi said the administration has no choice but to rely heavily on government resources because of the urgency of getting soured real estate loans and troubled asset-backed securities off the books of banks so that they can resume more normal lending to consumers and businesses.

"This is a start and we will see how far it goes, but I believe they will have to go back to Congress for more money," he said.

The Public-Private Investment Program that will be created was viewed as performing the same functions — selling bonds to finance purchases of bad assets — as a similar organization did for the Resolution Trust Corp., which was created to dispose of bad real estate assets in the savings and loan crisis of the 1980s.

According to administration and industry officials, the toxic asset program will have three major parts:

_A public-private partnership to back private investors' purchases of bad assets, with government support coming from the $700 billion bailout fund. The government would match private investors dollar for dollar and share any profits equally.

_Expansion of a recently launched Fed program that provides loans for investors to buy securities backed by consumer debt as a way to increase the availability of auto loans, student loans and credit card debt. Under Geithner's plan for the toxic assets, that $1 trillion program would be expanded to support purchases of toxic assets.

_Use of the FDIC, which insures bank deposits, to support purchases of toxic assets, tapping into this agency's expertise in closing down failed banks and disposing of bad assets.

Some industry officials said hedge funds and other big investors are likely to be more leery of accepting the government's enticements to purchase these assets, fearing tighter government restraints in such areas as executive compensation.

Administration officials, however, insisted Sunday that a distinction needed to be made between companies getting heavy support from the bailout programs and investors who are being asked to help dispose of troubled assets.

Romer said the partnership with the private sector will help ensure that the government doesn't overpay for the toxic assets that it will be purchasing.

"This isn't just another handout to banks," she said on CNN. "We very much have the taxpayers' interest in mind."

The administration's revamped program for toxic assets is the latest in a string of banking initiatives which have also included efforts to deal with mortgage foreclosures, boost lending to small businesses and unfreeze the market for many types of consumer loans.

In addition, the nation's 19 biggest banks are undergoing intensive examinations by regulators that are due to be completed by the end of April to determine whether they have sufficient capital reserves to withstand an even more severe recession. Those that do not will be able to get more support from the government.

The overhaul of financial regulation will be revealed by Geithner in testimony he is scheduled to give Tuesday and Thursday before the House Financial Services Committee.

In addition to the expanded authority to seize big institutions that pose a risk to the entire system, the administration is also expected to offer more general proposals on limiting excesses seen in executive compensation in recent years, where the rewards prodded extreme risk-taking.

The regulatory plan is also expected to include a major change that gives the Federal Reserve more powers to oversee systemic risks to the entire financial system.

The administration is working to unveil its proposed regulatory changes in advance of a meeting of the Group of 20 economic leaders, which Obama will attend on April 2 in London. European nations have complained that lax financial regulations in the United States set the stage for the current financial crisis.

© 2009 The Associated Press

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