Cheeseburger
03-10-2009, 08:16 AM
Sheesh, I had no idea until today we were bailing out foreign banks.
http://corner.nationalreview.com/post/?q=OWVmNTUwMmEwNzMwNGU1NDM5NTNlYmJhNTVkNDM5NmU=
Where Did the AIG Bailout Funds Go? [James Piereson]
The Wall Street Journal published an article in its weekend edition (March 7-8) on the American International Group bailout that deserves wider attention than it has so far gotten.
The U.S. government has thus far pumped $173 billion into AIG in a series of installments that began with an $85 billion bailout last September. Officials have had to allocate ever larger sums since then as they have gradually learned of the real depths of AIG's problems. Where have these funds gone? Thus far, the Treasury and the Federal Reserve, along with AIG, have refused to refused to say for fear of embarrassing the recipients.
The Journal has now begun to peel off the layers of the onion. Saturday's article makes clear that the taxpayers are not bailing out AIG, but rather all of the counterparty banks here and in Europe that bought Credit Default Swaps from AIG to insure their mortgage backed securities and related investments. The following quote makes the main point:
The beneficiaries of the government's bailout of American International Group Inc. include at least two dozen U.S. and foreign financial institutions that have been paid roughly $50 billion since the Federal Reserve first extended aid to the insurance giant.
Among those institutions are Goldman Sachs Group Inc. and Germany's Deutsche Bank AG, each of which received roughly $6 billion in payments between mid-September and December 2008....
The Journal has been able to identify several of the recipient banks, in addition to Goldman Sachs and Deutsche Bank — Merrill Lynch, Barclays, HSBC, Royal Bank of Scotland, Morgan Stanley, Wachovia, Bank of America, Lloyds, Banco Santander, Societie Generale, and several others. In other words, several of the world's largest banking institutions.
The article raises the question as to why American taxpayers — factory workers, school teachers, small business owners — are being asked to bail out international banks whose executives received extravagant bonuses in years one, two, and three for decisions that banrupted their institutions in year four? The answer given by the Treasury and the Fed is that the banks, unless they are paid, will collapse like falling dominoes and thereby bring down the entire financial system with them. This appears more and more to be an exaggerated proposition as the crisis intensifies while the bailouts accumulate. There is also the question as to why the public cannot be told who is receiving checks courtesy of the taxpayers.
more at link
ANYWAY - how can we afford to bail out the ENTIRE WORLD? Aren't we out of money yet? I guess they are just planning to print more? This is making the implosion of the banking system way worse than it would have been in the first place!!
http://corner.nationalreview.com/post/?q=OWVmNTUwMmEwNzMwNGU1NDM5NTNlYmJhNTVkNDM5NmU=
Where Did the AIG Bailout Funds Go? [James Piereson]
The Wall Street Journal published an article in its weekend edition (March 7-8) on the American International Group bailout that deserves wider attention than it has so far gotten.
The U.S. government has thus far pumped $173 billion into AIG in a series of installments that began with an $85 billion bailout last September. Officials have had to allocate ever larger sums since then as they have gradually learned of the real depths of AIG's problems. Where have these funds gone? Thus far, the Treasury and the Federal Reserve, along with AIG, have refused to refused to say for fear of embarrassing the recipients.
The Journal has now begun to peel off the layers of the onion. Saturday's article makes clear that the taxpayers are not bailing out AIG, but rather all of the counterparty banks here and in Europe that bought Credit Default Swaps from AIG to insure their mortgage backed securities and related investments. The following quote makes the main point:
The beneficiaries of the government's bailout of American International Group Inc. include at least two dozen U.S. and foreign financial institutions that have been paid roughly $50 billion since the Federal Reserve first extended aid to the insurance giant.
Among those institutions are Goldman Sachs Group Inc. and Germany's Deutsche Bank AG, each of which received roughly $6 billion in payments between mid-September and December 2008....
The Journal has been able to identify several of the recipient banks, in addition to Goldman Sachs and Deutsche Bank — Merrill Lynch, Barclays, HSBC, Royal Bank of Scotland, Morgan Stanley, Wachovia, Bank of America, Lloyds, Banco Santander, Societie Generale, and several others. In other words, several of the world's largest banking institutions.
The article raises the question as to why American taxpayers — factory workers, school teachers, small business owners — are being asked to bail out international banks whose executives received extravagant bonuses in years one, two, and three for decisions that banrupted their institutions in year four? The answer given by the Treasury and the Fed is that the banks, unless they are paid, will collapse like falling dominoes and thereby bring down the entire financial system with them. This appears more and more to be an exaggerated proposition as the crisis intensifies while the bailouts accumulate. There is also the question as to why the public cannot be told who is receiving checks courtesy of the taxpayers.
more at link
ANYWAY - how can we afford to bail out the ENTIRE WORLD? Aren't we out of money yet? I guess they are just planning to print more? This is making the implosion of the banking system way worse than it would have been in the first place!!