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In Advance Of Today's Bread And Circuses, Joe Cassano Edition

Tyler Durden's picture




 

In advance of today's most recent theatrical lashing on AIG, and Goldman's involvement with the broke insurer, this time before the Financial Crisis Inquiry Commission, the NYT's Gretchen Morgensen and Louise Story revert to their favorite topic: regulatory and administrative capture in the context of the AIG bailout, whose sole purpose was to risk taxpayer funds in order to rescue a few megabanks. In a well-timed piece, the two reporters don't share much new (after all, with a plethora of smoking guns already out there and blatantly ignored by the regulators, there is little one can add), although we do learn that as part of the waiver, AIG was forced to sign a waiver indemnifying the very banks on the receiving end of the bailout parade.

When the government began rescuing it from collapse in the fall of 2008
with what has become a $182 billion lifeline, A.I.G. was required to
forfeit its right to sue several banks — including Goldman, Société
Générale
, Deutsche
Bank
and Merrill
Lynch
— over any irregularities with most of the mortgage
securities it insured in the precrisis years.

Unknown outside of a few Wall Street legal departments, the A.I.G.
waiver was released
last month by the House Committee on Oversight and Government Reform
amid 250,000 pages of largely undisclosed documents
. The documents,
reviewed by The New York Times, provide the most comprehensive public
record of how the Federal Reserve Bank of New York and the Treasury Department orchestrated one of the biggest
corporate bailouts in history.

There is little at this point that can shock or even surprise the dulled minority of the US public who actually cares about the collapse of US society and its replacement with a corporatist (or rather Wall Streetist) hydra. We are sure this topic will be covered for an hour or two, then Goldman's Gary Cohn will receive a wrist slap, will be told never hope for another bailout again, then allowed to go back to his hedge fund where the Fed will provide him 0.25% funding to leverage 100 times and purchase 10x beta bankrupt retail stocks.

So let's enjoy the spectacle with relish: for the first time in history we will get a chance to hear and see Joseph Cassano, the man who lost about half a trillion on behalf of AIG shareholders, and as a result will not see a dime recouped or a day behind bars. Now, if he had lost $5,000, it would have been a different matter. Others present will be Goldman's COO and Head of credit, market and operational risk.

The full listing can be found here:

  • Session 1: Overview of Derivatives

    Michael Greenberger
    Professor
    University of Maryland School of Law
    Steve Kohlhagen
    Former Professor of
    International Finance, University of California at Berkeley and former
    Wall Street derivatives executive
    Albert "Pete" Kyle
    Charles E. Smith Chair
    Professor of Finance
    University of Maryland
    Michael Masters
    Chief Executive Officer
    Masters Capital Management, LLC
  • Session 2: American International Group, Inc. and
    Derivatives

    Joseph J. Cassano
    Former Chief Executive Officer
    American International Group, Inc. Financial Products
    Robert E. Lewis
    Senior Vice President and Chief
    Risk Officer

    American International Group, Inc.
    Martin J. Sullivan
    Former Chief Executive Officer

    American International Group, Inc.
  • Session 3: Goldman Sachs Group, Inc. and Derivatives

    Craig Broderick
    Managing Director, Head of
    Credit, Market and Operational Risk
    Goldman Sachs Group, Inc.
    Gary D. Cohn
    President and Chief Operating
    Officer
    Goldman Sachs Group, Inc.

The hearing will begin at 9:00 am and will be televised on C-Span.

All in all, just more teleprompters, bread and circuses you can believe in, all serving to distract the broader population from the greatest middle-class robbery occurring every day behind the scenes.

 

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Wed, 06/30/2010 - 08:33 | 443923 ZeroPower
ZeroPower's picture

Hopefully the supporting cast (aka rep's asking questions) have a bit more knowledge than the ones questioning Blankfein:

Sir, have you ever shorted a stock?

 

...

Wed, 06/30/2010 - 13:39 | 444501 Geoff-UK
Geoff-UK's picture

Good point--with that question, he's got Blankfein on the ropes!!!

It's jaw-droppingly amazing that the mind-numbed egomaniacs who ran for student council in junior high are now U.S. Congressmen and Senators--with no idea what is going on.  All they understand is Blankfein can give them serious reelection money, and Joe Sixpack can't.  And there's a 0.0000005 percent chance the average American will recognize the bribe. 

So the politicians bend taxpayers over to bail out the big banks, the big banks pay off our pimp (looking at you Barney Fwank) and the politicians then apply the lubrication of FREE health care and social security to ease the pain of entry from Lloyd.

If you're actually working for a living generating income and thus not getting lube, the process is, of course, much more painful for you.

Wed, 06/30/2010 - 08:36 | 443929 Commander Cody
Commander Cody's picture

One thieves' den visiting another's.  Party on!

Wed, 06/30/2010 - 11:11 | 444184 Inspector Asset
Inspector Asset's picture

Of all the characters,

Joes Muckety chart leads no where. One item > AIG .

 

I thought this man would of had a sking accident or drown in a pool by now.

 

He really must know how to keep his yapper shut!

Wed, 06/30/2010 - 08:44 | 443935 anony
anony's picture

Read almost everything there is about Joe the hummer Cassano.  So I will endure the flim-flammery he is bound to spew on the equally hopelessly corrupt committee.

Thanks for keeping his name front and center as a primary perp and should be on an ice floe with dishibernating polar bears for company.

The MSM I'll bet have completely ignored him and his role in the financial meltdown.  If I were former military, special forces trained in snipery, he'd be my first target for elimination.   

Wed, 06/30/2010 - 13:43 | 444509 Geoff-UK
Geoff-UK's picture

Cassano isn't the bad guy.  He would have ruined AIG and their bondholders, but that's it.  Hate Barney Frank, Chris Dodd, George Bush, and Barack Obama for making it the taxpayers' problem.

Don't hate the unions of GM and Chrysler for ruining their employers.  Ford would have reaped the benefits and become much stronger.  It's Barney Frank, Chris Dodd, George Bush and Barack Obama who made it the taxpayers' problem.

If you're a tax-payer versus a tax-user:  remember this advice:  "If you sit at a poker table and can't spot the sucker--the sucker is you."

 

 

Wed, 06/30/2010 - 08:47 | 443937 London Dude Trader
London Dude Trader's picture

That criminal Cassano made off with $300 million while at the same time leading AIG to bankruptcy. Talk about institutionalized larceny. 

Wed, 06/30/2010 - 08:51 | 443944 Careless Whisper
Careless Whisper's picture

looking forward to mister cassano's book and movie deal.

Wed, 06/30/2010 - 08:54 | 443948 Cheeky Bastard
Cheeky Bastard's picture

Senor Durden I hope you will cover the ADP report. I need a laugh today.And the action in the futures that occurred when the # was published. Hilarious.

Wed, 06/30/2010 - 12:15 | 444318 ZeroPower
ZeroPower's picture

Indeed.

The drop was nice, and go figure we're above that by now

Wed, 06/30/2010 - 08:56 | 443950 bobby02
bobby02's picture

I never knew about the waiver. As a practical matter, they probably never could have sued anyway but to put it on paper is particularly egregious.

There are so many villains in this story that it’s hard to pick the worst, but Cassano’s gotta be a top pick.

Wed, 06/30/2010 - 09:05 | 443964 Fazzie
Fazzie's picture

  So long as the dumbed down electorate thinks there is substantive differences between the two parties, the AIGs and Goldmans of the world have only the minor inconvenience of these symbolic wrist slappings to fear.

Wed, 06/30/2010 - 09:13 | 443985 dantes1807
dantes1807's picture

I think Goldman is there to offer Mr. Cassano a job and a badge of honor. Cassano invented the book on looting and Goldman wants a copy of that book!

Wed, 06/30/2010 - 10:03 | 444082 snowball777
snowball777's picture

Joe Cassano Jr is a cowardly and pitiful little excuse for a Golem.

He can lie with numbers better than most, but is as decent as your average pickpocket.

Wed, 06/30/2010 - 10:20 | 444110 glenlloyd
glenlloyd's picture

Looks like it'll be a three ring circus today.

Wed, 06/30/2010 - 10:55 | 444159 jc125d
jc125d's picture

I'd fork over pay-per-view to watch Grayson and Taibbi do a tag-team bitch slap on Cassano.

Wed, 06/30/2010 - 11:41 | 444233 Ned Zeppelin
Ned Zeppelin's picture

"When the government began rescuing it from collapse in the fall of 2008 with what has become a $182 billion lifeline, A.I.G. was required to forfeit its right to sue several banks — including Goldman, Société Générale, Deutsche Bank and Merrill Lynch — over any irregularities with most of the mortgage securities it insured in the precrisis years."

The question is, who asked for the waiver from AIG? Who presented it as a prerequisite for government assistance? I want to know who.  

If you are standing in AIG's shoes, as a trustee or receiver or in a similar fiduciary capacity, why on earth release a possible source for recouping funds that the government/taxpayer was "forced" to disgorge.

Monstrous theft for which no redress is available or has been sought.  The silence is deafening, but speaks volumes.  Why bother with this hearing?

A hard rain's gonna fall.

Wed, 06/30/2010 - 11:56 | 444265 JW n FL
JW n FL's picture

So what caused the 50 to 1 leverage to be put under pressure? WallStreet!? Shorts!? or was it when the monies where pulled out of the programs that provided the backstop for the 50 to 1 leverage that was until that time backed by Federal or as I like to call them Tax Trough Dollars... Bush pumped 100% more money into the programs and then several years later... he pulled funding from those same programs he pumped...

                    50 to 1 leverage on Federal monies that had been flowing like a river for 2 or 3 decades? which then got pulled... caused the stresses that lead to Goldman being able to short, which lead to Lehman's collapse and so on… This financial crisis was engineered and is was an Austrian lite thought process that lead us to this collapse… Reigning in any spending, on a broad scale has a ripple effect that spans well beyond what we would choose to see.

 

 

                    Not a story on the first domino that fell anywhere, even here. Bush pulled the backstop away from WallStreet... maybe all of those dollars going the other way pissed him off? http://money.cnn.com/2006/10/31/news/political_donations/index.htm

 


December 16, 2003. The American Dream Downpayment Assistance Act authorizes up to $200 million annually for fiscal years 2004 - 2007.

http://www.hud.gov/offices/cpd/affordablehousing/programs/home/addi/

 

HOME is the largest Federal block grant to State and local governments designed exclusively to create affordable housing for low-income households. Each year it allocates approximately $2 billion among the States and hundreds of localities nationwide. The program was designed to reinforce several important values and principles of community development:

http://www.hud.gov/offices/cpd/affordablehousing/programs/home/

 

Which was part of: HOME is authorized under Title II of the Cranston-Gonzalez National Affordable Housing Act, as amended. Program regulations are at 24 CFR Part 92.

Which Daddy Bush pushed thru...

 

Now, after pumping all of these dollars in... Bush cut funding, never mind the shit head idiot dems v. reps...

When Bush pumped the housing market, with the magic, un-written Federal backstop clause and then cut the funding... all of that 50 to 1 leverage took on a new sheen... 50 to 1 leverage for an ongoing Federal Program, or as I would call it... The big boys feeding from the public trough of tax dollars... was safe, safe enough that how many absolute return funds bought into the rated, magic Federal funded and back stopped debt machine / vehicles? LOTS!

But, when the Federal monies where cut... and the magic backstop was found to be a lie... the domino's fell, one after another... Goldman, being smarter than the rest bought shorts and insurance? how many different ways did Goldman profit from the failure, per deal... in the plainest of terms... for every one dollar in failed debt Goldman earned $2 dollars? Short + Swaps? I am guessing there just for the fun of it... sorry.

 

But the failure was brought on by Bush pumping and then de-stabilizing the Federal dollars (really tax payer dollars) that where assumed to be safe by Bear, Lehman and so on... Don't get me wrong, Barney is an idiot Lobby whore just like Bush... but there is no difference between Barney, Bush, Obama, Clinton and so on... they are all moved by Lobby dollars... the song and dance is strictly for the public's entertainment.

 

Obama is Bush part duex.. he is not a commie, he has taken every Bush program and ran with it... not run from it. Dont get caught up in the public spin machine.

 

I offer... http://www.opensecrets.org/ see who owns your favorite representatives and then for fun look at the dem's side who should be against the reps push... and see how the dollars move the votes, not the party affiliations.

 

John Mcsame spent all of a whole 10 minutes yesterday grilling Goldman, and said he was very disappointed in Goldmans behavior... he spoke less that the girl in Levin's ear...

Top Industries

John McCain

http://www.opensecrets.org/politicians/industries.php?cycle=Career&cid=N00006424&type=I

Finance, Insurance & Real Estate

       $33,457,679

  $745,772

    $32,711,907

 

           

Lawyers & Lobbyists

      $13,170,368

   $307,508

     $12,862,860

 

                   

Other

      $42,122,454

     $8,400

       $42,114,054

 

John McSame spent 100 times less times talking about how we all have been screwed by Goldman for around 10 times more money than the other committee members where Bribed... Oops, I mean Lobbied with.

 

There is no difference between the two parties, the lobby has bought and paid for all the whores inside the beltway, don’t think because of the cute sound bite you like hearing that the two parties are any different.

 

 

 

Wed, 06/30/2010 - 12:02 | 444279 sweet ebony diamond
sweet ebony diamond's picture

Gary the Grinfucker had better be funny. No World Cup on today.

Wed, 06/30/2010 - 12:09 | 444297 JR
JR's picture

YOUR TICKET TO FREEDOM by Michael Boldin | June 30, 2010

Tom Woods' new book, Nullification: How to Resist Federal Tyranny in the 21st Century, is not just another reading assignment on the evils and failures of the current administration... Instead, it’s the centerpiece of a mass movement – a new strategy to deal with those evils and failures of federal administrations – past, present, and future.

Prominent founders like Thomas Jefferson and James Madison warned us that if the federal government were ever to become the sole and exclusive arbiter of the extent of its own powers, those powers would always grow, regardless of separations of power, protests, lawsuits, elections, or any other vaunted part of the American system.

Put another way, this would be like having your ex’s mother as the final judge on the structure of your divorce settlement. 

Seriously, folks, does this sound like an effective solution? ...

Woods makes the case that there actually is another option – one that the powers that be (and their government-run schools) don’t want you to know about. Nullification – the act of rendering unconstitutional laws null and void, or inoperative, on a state level – is, as Thomas Jefferson put it, the "rightful remedy" in response to acts of undelegated power by the federal government, and Woods lays it all out in brilliant fashion.

In Nullification, Woods not only goes through the historical and Constitutional case for nullification, but also many of the modern day applications of the principle. He shows us how this isn’t just a good idea, it’s already a movement – and it's ready to hit the mainstream. …

For example, in the past 2 years, multiple states have passed laws making national health care mandates illegal, eight others have passed laws nullifying some federal gun laws and regulations, and others are working to ban federal cap-and-trade regulations. And this is just the beginning. Dozens of states across the country are considering laws to ban a myriad of unconstitutional federal "laws" (which aren't really laws at all) and people are starting to catch on that the states can stop D.C.! …

Read the article reprinted from the Tenth Amendment Center:

http://www.lewrockwell.com/boldin/boldin14.1.html

Sat, 08/21/2010 - 11:21 | 534749 herry
herry's picture

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