Grayson Rips Bernanke Over Latest AIG Bailout, Insinuates Attempted IRS Fraud In Grossly Illegal Deal
One day, Vince McMahon will pay handsomley to get Ben Bernanke and Alan Grayson in the squared circle. Until that day, we should just hope and dream. In the meantime, we have litters and public appearances by the Florida Congressman, who takes the latest AIG "taxpayer payback" opportunity to remind everyone of just how deeply he loves the "we create money out of thin air" institution that is the Federal Reserve.
I write with concern about two announced deals that are lauded by AIG CEO Robert Benmosche as AIG's plan to 'pay back the taxpayer'. In reading through the deal, it looks to me like the Federal Reserve is simply engaged in yet another disguised bailout of AIG. It's not surprising that the New York Fed continues to shovel money at AIG using its balance sheet, since this seems to be official policy, but this time, the bailout also involves cheating the IRS.
In describing the deal specifics:
This relationship is not significantly different from just making the subsidiaries collateral for the existing loan from the New York Fed, with four exceptions. One, the FRBNY's right are downgraded in this deal from creditors to preferred shareholders. Two, AIG gets to claim "repayment" and take a tax loss to reduce the company's income taxes. Three, the FRBNY credit facilities are already collateralized. Four, the New York Fed owns nearly 80% of AIG, putting it on all sides of the deal.
And most brazenly, and deserving of applause, the allegation that Bernanke is implicilty breaking the law by his most recent AIG bailout:
As the New York Fed owns most of AIG, this deal could be considered a faked sale to generate a capital loss for the purposes of injecting Treasury funds into AIG without the consent of Congress. Please explain the legality of the arrangement.
Full Grayson letter to Bernanke:
| Attachment | Size |
|---|---|
| Bernanke Letter on AIG 12-70001.pdf | 905.68 KB |
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on Tue, 12/08/2009 - 16:37
#157029
In America I thought we had to explain the illegality of the arrangement.
on Tue, 12/08/2009 - 18:20
#157174
You must never have had a tax audit. The IRS will pull something out of your file and say, convince me this is legit or you are going down.
In this case the letter writer has already put force a case for illegality, and is asking "so, am I wrong?"
on Tue, 12/08/2009 - 19:22
#157288
I'm not sure, but I think that doesn't apply when the subject is within the government. Or it shouldn't anyway.
on Tue, 12/08/2009 - 21:19
#157426
Grayson understands that government officers should be held to a HIGHER standard of legality than anyone else. In the first place, one cannot lead except by example. In the second place, they take an oath.
on Wed, 12/09/2009 - 09:46
#157770
The 28th ammentment states, any governmental action that benefits Goldman Sachs "are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency"
If that quote looks familiar, it is the exact quote from the TARP bill regarding Hank's usage of the $700B to gift to Goldman.
Not to worry, if Paulson and Geithner don't work out, Obama will surely reach outside of Wall Street to find the next treasury secretary. In all sincerity, after Jamie Dimon, they are running out of corrupt, seasoned Wall Street CEOs to tap. Better hope Dimon finally puts the nail in the coffin of the USD.
If anyone is curious, as America was melting down last September, the Wall Street firms had oil tankers floating in the ocean, so when the USD disappeared the banks would still exist.
on Tue, 12/08/2009 - 22:13
#157476
The problem is that this isn't an arms length transaction and therefore may be fraudulent. Bernanke was so arrogant when he wouldn't answer questions to the Congressmen a few months ago that he is rightly in their cross-hairs.
on Wed, 12/09/2009 - 02:37
#157626
The NY Fed is not the Government. Much as they may be acting as such right now. Neither is AIG.
It would seem to me to be a case of two private companies in cahootz.
on Tue, 12/08/2009 - 16:43
#157030
WHEN is this stunning parade of abuses of taxpayer monies going to be stopped?? STUNNING.
on Tue, 12/08/2009 - 17:12
#157070
Read Revelation in the Bible. That'll tell ya!
on Tue, 12/08/2009 - 16:47
#157036
fuck you bugs, commy pig
on Tue, 12/08/2009 - 16:58
#157058
LOL
on Tue, 12/08/2009 - 16:48
#157038
Other than possibly Ron Paul, is there any elected official who has half the intelligence of Mr. Grayson? Is it intelligence or just intestinal fortitude or some combination of both? Why is he the only person saying what is on my mind? Who else will openly confront the FR on this phony deal? Keep it up Mr. Grayson, keep it up.
on Tue, 12/08/2009 - 16:49
#157041
uh, everybody else be bought and paid for ? Just my guess ;-)
on Tue, 12/08/2009 - 17:11
#157066
++ and +
on Tue, 12/08/2009 - 17:38
#157110
Alan Greyson's stock broker is....Peter Schiff. Hes a client of Europac.
I cant wait till Schiff is up there firing off Qs at these people!
on Tue, 12/08/2009 - 19:16
#157279
you're shitting - really? i never would have guessed those two being hooked up.
on Tue, 12/08/2009 - 17:39
#157113
As a constituent, you should know he gets crushed in Central Florida for his standing up to ObamaCare v8.2. I rarely hear him applauded for his finance work.
Granted, I am a hammer, so I see everything as a nail, so I just focus on the economic policies in detail...regardless, if he kicked puppies in his free time I would still support him on the merits of this wrks alone.
on Tue, 12/08/2009 - 16:50
#157042
After blaming the last administration, who was asked "prior to your current posistion where were you and what job did you hold?
jeopardy music
Times up. Who is Turbo Tax Timmy Geithner from the FRBNY?
bingo
on Tue, 12/08/2009 - 16:55
#157052
I'd give McMahon an ounce of gold to see Grayson's ass in Ben's face.
on Tue, 12/08/2009 - 16:58
#157057
grayson is both rich, very, smart, mucho, and totally disgusted and mad at the powers that be, cc the irs, doesn't get any better than that
on Tue, 12/08/2009 - 17:05
#157062
Thanks Mr. Grayson for keeping all over these guys.
Bernanke must go.
Geithner must go.
Summers must go.
Schapiro must go.
P.S. Rahm: these folks are phucking up so bad that even the disjointed Repubs might blow your team out in the midterms.
on Tue, 12/08/2009 - 18:18
#157173
Obama must be impeached as well. What a COMPLETE DISGRACE he has been. Puppet leader of a banana republic.
on Tue, 12/08/2009 - 18:24
#157180
Impeachment should not be limited to the POTUS GG. Unfortunately, the concept of justice is even more lost within the halls of congress than it is outside of them.
on Tue, 12/08/2009 - 23:08
#157529
Hear-hear DH, GG, and MK!!!!!!!!!!!!!!!!!!!!!!!!!!
on Wed, 12/09/2009 - 11:34
#157925
It seems that Obama actually *WAS* listening to Rev Wright the past 20 years.
on Tue, 12/08/2009 - 17:10
#157065
Other than possibly Ron Paul, is there any elected official who has half the intelligence of Mr. Grayson?
Yea, Lyndon Larouche, genius status. He is the founder and contributing editor of the Executive Intelligence Review, and has written prolifically on economic, scientific, and political topics, as well as on history, philosophy, and psychoanalysis.
on Tue, 12/08/2009 - 17:11
#157067
To Deadhead :
Fully agree but you forgot one : OBAMA must go .
on Tue, 12/08/2009 - 17:18
#157079
To Deadhead :
Fully agree but you forgot one : OBAMA must go
Where is the transparancy that we were promised over and over and over?
on Tue, 12/08/2009 - 17:27
#157096
Its opaque transparency of the political kind.
on Tue, 12/08/2009 - 17:19
#157080
And the fllecing goes on.....
on Tue, 12/08/2009 - 17:24
#157088
This is the kind of secrecy Bernanke wants to protect from an audit, because of course if Congress knew this it would hurt his ability to set rates, or something like that.
on Tue, 12/08/2009 - 21:27
#157433
Yeah, interest rates - the indicator which doesn't actually mean anything anymore because it has NOTHING to with ANYTHING happening in the real world, MASSIVELY gamed as it is.
on Tue, 12/08/2009 - 17:27
#157095
I nominate Ron Paul as the next and last Fed Chairman. He will be entrusted to conduct a complete formal audit, then dismantle it.
on Tue, 12/08/2009 - 19:18
#157281
talk about dreaming.
but yeah, that'd be cool.
on Tue, 12/08/2009 - 19:30
#157297
Only in my dreams are Bernanke and the Federal Reserve eliminated.
on Tue, 12/08/2009 - 19:57
#157346
Thank you very much! Great idea.
on Tue, 12/08/2009 - 23:10
#157532
second that--idea of the century!!!!!!!!!!!!!!
on Wed, 12/09/2009 - 00:39
#157585
+1
on Tue, 12/08/2009 - 17:46
#157125
Is the IRS any better than the SEC or Congress in prosecuting fraud. FBI, uh, only if your beating down BHO's agenda.
We are so screwed.
on Tue, 12/08/2009 - 18:08
#157158
I like Grayson for a lot of his toughness and his way of doing business. Do not forget though, that he is a Democrat that is pushing a paid vacation bill.
"The Paid Vacation Act will require at least one week of paid vacation for employees at companies with at least 100 employees. Full- and part-time (25 hours per week/1250 hours per year) workers will be eligible after one year of service.
Three years after enactment, companies with at least 50 employees would be required to offer at least one week of paid vacation, and companies with at least 100 employees would be required to offer at least two weeks of paid vacation."
As an employee, this sounds great to me, but as an American that believes in freedom and a "free market" (if there is such a thing) I don't really agree.
I must say though, I've heard more good things coming from Grayson than I've heard from any Conservative in the past 6 months. I know both side of Congress are total frauds, and do not represent us anymore, but I still view things as a conservative.
on Tue, 12/08/2009 - 21:27
#157434
I think a lot of those labor laws started with Theodore Roosevelt, who was a Republican.
on Wed, 12/09/2009 - 19:11
#158411
To be fair though some labor laws had merit. I don't think even the most free-market capitalists today would argue for child labor being legal or against workers' compensation in the case of an industrial accident.
It's when you end up with ten-yeared janitors in the NYC public school system or auto-workers earning $50 an hour where things get a bit out of control...
Well then again, maybe this guy would argue for child labor:
http://www.youtube.com/watch?v=qxv35KNSyqE&feature=related
on Tue, 12/08/2009 - 18:15
#157169
AIG is the pesky kid brother, broke and lying around your house.....always needing some change to tide him over. Can't toss him cause he's got nowhere to go.
So Grayson spotted the backdoor bailout.
Since Uncle Slam runs this store, Grayson has every right to get answers. It'll be curious to see the answer he finally gets after the Fed lawyers get done scrambling around. IRS won't do squat about any of it. A tangled web.
on Tue, 12/08/2009 - 18:16
#157170
Coming soon: Airliner that departs Washington, DC en route to Orlando mysteriously crashes killing all onboard including a freshman congressman from Central Florida.
on Tue, 12/08/2009 - 18:21
#157176
The CIA is pretty adept at these kind of shenanigans.
on Tue, 12/08/2009 - 18:28
#157185
GG, actually the CIA is so inept that they contract most of this sort of work out. Besides, this process adds one more level of plausible deniability to the mix. Something governments are always seeking. Hence the reason England is so upset with the way we abused Diego Garcia over these past few years.
on Tue, 12/08/2009 - 19:13
#157277
+100
on Tue, 12/08/2009 - 19:43
#157321
Thats where Black-Water comes in.
on Tue, 12/08/2009 - 20:34
#157385
To an extent. Black-Water is more like a Houdini diversion tho... Just like Houdini, the diversion needs to be really good and this is one thing some very clever thinkers at CIA understand full well.
on Wed, 12/09/2009 - 19:13
#158412
The artist formerly known as blackwater is now known as Xe... how's that for a diversion?
on Tue, 12/08/2009 - 22:56
#157516
Okay GG, name one incident where they showed how adept they are. You've been watching too many B-videos.
on Tue, 12/08/2009 - 18:16
#157171
I think Bernanke and Co. will insitute a small 'Market' panic to ensure His reapointment, a flight to 'safety' if u will ?
I would expect -10%,15% on the market in the next 2 weeks
on Tue, 12/08/2009 - 18:29
#157187
I thought Grayson asked all the right questions in that letter. This most recent deal between the Fed and AIG stinks to high heaven. I don't see any possible benefit to the Fed. They moved down the capital structure but still have the same maximum $25 billion payoff they had with debt. Presumably they now don't get paid interest on the $25 billion. And AIG for some strange reason gets all or most of the upside should the businesses sell for more than $25 billion. Based on this article it doesn't look likely that will happen:
http://bloomberg.com/apps/news?pid=20601109&sid=amaj3P5pVCyQ&pos=13
I think the most likely scenario is that AIG couldn't pay interest on all the debt, couldn't sell these business units, were looking at downgrades from the ratings agencies and this deal was cut as an extend and pretend strategy. This isn't even debt for equity. It's debt for a put option and an upfront payment while keeping a free call option on the businesses. There's not a private buyer in the world who would cut that deal. It is theft.
on Tue, 12/08/2009 - 18:46
#157216
i like Grayson, but when do they start going after the man making the appointments and setting the policies. Some of these folks like Grayson need to start going after Princess "Yurtle the Turtle" Obama.
on Tue, 12/08/2009 - 19:30
#157294
Maybe Geithner is in the blender for his resistance to the idea. He is the head of the IRS. Makes one wonder who Geithner will take down with him now that the oligarchy dislikes him and who is now planning Geithner's exit to stage left. I wonder if he knows who got the money.
on Tue, 12/08/2009 - 19:53
#157342
tinytim as whistleblower?
now that's change i can believe in.
on Tue, 12/08/2009 - 20:28
#157308
And while we are on the subject of Vince McMahon, that slime ball put a referee up against CM Punk on a Friday Night Smack Down. I do not see why he would not put up a Grayson vs. Bernanke match. Call him, I bet he would.
on Tue, 12/08/2009 - 19:46
#157328
What about FNM and FRE?
Oh, my bad.
Never mind.
on Tue, 12/08/2009 - 19:49
#157333
I don't doubt the shenanigans with TARP/AIG/etc. but whatever brought on the veiled threats about the IRS might be a bigger deal than even AIG.
1. Steal underpants
2. ?
3. Profit!
Source of income baybee. Inquiring minds wanna know, and "?" won't cut it. A massive influx of money into a banking account needs to be essplained.
Expect intensified discussions during the next several weeks about global banking and carbon trading as the last holdouts to global governance take their bribes or otherwise succumb and We the People get dragged kicking and screaming into the new millennium.
on Tue, 12/08/2009 - 20:21
#157374
This shit is about as good as professional wrestling. A series of scripted rockem sockem dramas designed to mesmerize spectators who think they give a shit, but really don't.
I totally respect and support the great work of Dr. Paul, Mr. Grayson, and several others in DC. What does it take to get the rest of our Representatives and Senators to step up to the cold hard facts and just do what is fucking best for our country? Are they so corrupt, bought off, or otherwise stupid to not give a shit about killing the geese that lay golden eggs?
People In Government, WAKE UP AND DEFEND THE CONSTITUTION.
on Tue, 12/08/2009 - 21:31
#157438
I'm not normally given to cheerleading but this deserves an exception:
GO GRAYSON!
on Tue, 12/08/2009 - 22:14
#157477
I wonder if the squid already bought property in Romania, China and Russia? It may need it when this is all over.
on Wed, 12/09/2009 - 00:39
#157586
Grayson is too smart and unbought to last. If the MSM fails to marginalize him, someone will engineer a convenient fatal accident or medical illness. He is hitting too close to home with Ben, et al.
on Wed, 12/09/2009 - 02:33
#157625
They will find some dirt on him.
on Wed, 12/09/2009 - 02:32
#157624
Meanwhile I'm paying my taxes and if the economy ever recovers, its guaranteed that taxes will increase to a level where the average joe will feel like he is still in a recession. Audit the Fed thats the first step.
on Wed, 12/09/2009 - 08:29
#157694
'Please explain the legality of the arrangement.'
Turbo timmeh to the rescue !