American International Group
The battle over corruption inside the Fed and the control of our central bank by the big city banks had been going on for a century and more. That is why the scandal and criminality of the AIG bailout demand the attention of every American. Happy Thanksgiving, BTW
Even with equities rocking as gold's top blasted off yesterday, the credit picture was mixed. While most financials outperformed, with the exception of AIG, the action in other sectors was decidedly mixed, with industrials widening by a large margin even as underlying stocks ramped higer. Every product is now left to fend for itself.
Today's Wall Street Journal featured a story about the upcoming "debt avalanche" faced by many of the major banks which have mountains of corporate bonds coming due. Yet the U.S. Treasury offloaded another load of fresh fiatco bonds without a hitch, and Treasury yields proceeded to plunge again. Why are the banks worried when so many "yield thirsty" investors are so anxious to lap up 1% and 2% 2-year bonds?
Did Goldman Sachs dissemble and equivocate in its responses to the New York Times? Based on these responses, the answer is yes. Treasury Secretary Geithner may wish to keep that in mind the next time he looks to Goldman Sachs for his answers. Mr. van Praag states “Starting in the mid-90s, we bought credit default swaps from AIG to protect our firm from the risk of a decline in the value of risk we had assumed on behalf some of our clients, (i.e. assets to which we had exposure).” Near the end of his email he again mentions “CDOs from our clients” (emphasis added). His email never once mentions that the problematic CDOs requiring collateral calls from A.I.G. that precipitated its liquidity problems, the one’s referenced in the report, seem to be chiefly 2004/5/6 vintage CDOs. Goldman underwrote the Abacus CDOs on its own list, and Goldman also underwrote CDOs that featured prominently and in large portion on the lists of French Banks SocGen and Calyon as well as Bank of Montreal and Wachovia that also hedged this risk using CDSs with AIG.
- Wave of debt payments facing U.S. government (NYT)
- Jamie Dimon seen as good fit for Treasury (NYPost)
- Goldman's response to questions about AIG (NYT)
- Deficits and loose money should lead to higher gold (MarketWatch)
- Gold hits record as dollar slips (Reuters)
- Geithner's crisis sleepwalk is reason he must go (Bloomberg)
Janet Tavakoli Retracts Her Apology To Goldman Sachs, Calls For More Regulation Of The Government Backstopped Hedge FundSubmitted by Tyler Durden on 11/22/2009 11:57 -0400
"In light of the SIGTARP report, I withdraw my earlier apology to Goldman. Public commitments to AIG are currently around $182 billion. If you wonder what Goldman CEO Lloyd Blankfein meant when he said: “[Goldman Sachs] participated in things that were clearly wrong and we have reason to regret and we apologize for them,” think of Goldman’s role in AIG’s crisis, Goldman’s bailout, and Goldman’s ongoing heavy taxpayer subsidies. That way, one of you will be genuinely sorry about it." - Janet Tavakoli
Grayson Post-Mortem On Last Night's Historic Fed Transparency Victory And The Revelation Of Barney Frank's HypocrisySubmitted by Tyler Durden on 11/20/2009 12:08 -0400
After the historic defeat of Fed anti-transparency amendments, and the most recent disclosure that despite all his posturing Barney Frank is, as expected, deep in the pockets of the Wall Street and Fed kleptocracy, here are some post-mortem observations from Grayson, Spitzer and Ratigan.
- Bloomberg censorship alert? (see inside)
- Goldman stock holders miffed at bonuses (WSJ)
- White House rebuke: angry Democrats shut down vote (HuffPo)
- Fed makes monitoring bank capital foremost concern (Bloomberg)
- Risk fatigue sparks correction speculation (FT)
- Treasury yield plunge sends warning (Barrons)
- Trichet says not all measures to be needed in the future (Bloomberg)
Dear Chairman Frank, Ranking Member Bachus, and Members of the Committee,
During the past two years, the Federal Reserve dramatically changed its operating procedures. Instead of simply setting interest rates to influence macroeconomic conditions, it rapidly acquired a wide variety of private assets and extended massive secret bailouts to major financial institutions.
Technical Profiles of Gold vs Silver, the US Dollar vs Gold and the US Dollar with highlights from an interview with the winner of the 2008 Automated Trading Championship
Goldman Sachs, which lately has been caught in a toxic spiral of potential misrepresentations (courtesy of the SIGTARP report which plainly refuted the firm's claims that it was not on the hook vis-a-vis AIG, and by the way, Ms. Tavakoli, we are waiting for you to retract your apology to the 85 Broad team) and horrendous PR (first Blankfein apologizing for something, then Gasparino telling Lloyd he should step down), may be the final straw that finally breaks open the Fed's "book of death" (for the middle class, f/k/a "book of life" for the banker cartel). Ahead of tomorrow's hearings on various Fed transparency initiatives, Rep. Elijah Cummings is calling for a complete tear down of the existing Fed structure, and demands an overhaul to the "minimal accountability" that the Fed issubject to courtesy of the current Wall Street perpetuated ( and lobbied) status quo.
As the time to make or break the Fiat Money Overlords (no, not Chrysler), aka the Successor to the Second Bank of The United States which President Andrew Jackson managed to disassemble in 1832, yet which came back with a vengeance in 1913 under the guise of the Federal Reserve, approaches, two independent amendments emerged today: one drafted by Fed transparency proponents Ron Paul and Alan Grayson (found here) and one by Bank of America and Citigroup's favorite Congressman, North Carolina democrat Mel Watt (found here). As a reminder, here is a list of the Congressman's top contributors and sources of money in 2007-2008, which may explain some of his motivations: #1 Bank of America;#2 Wachovia Corp;#3 American Express;#4 American Bankers Assn.
Rather quiet day in credit yesterday (and today credit was wider even with equities completeing 9 out of the 10 past days higher): a few names that stoof out on the wider side: AIG, BXP, EQR, KMP, CAH, RAI, AA and a several utility names. Tighteners were HIG, MET, AXP, JCI, UNH, DOW and RRD. The rest were predominantly flat.
The latest plot by OCTOsquared (the Octopus and the Octogenarian, well, technically Buffett is still 79 years young, but give him a few hundred days until August 1, 2010) is to take advantage of CIT's bankruptcy by poaching thousands of small and medium business clients. The timing, of course, could not be more opportunistic. Bloomberg reports that "Goldman Sachs Group Inc., under fire in Washington for setting aside billions of dollars for bonuses a year after getting a taxpayer bailout, is preparing to team up with billionaire investor Warren Buffett to provide assistance to small businesses, said people familiar with the matter." This so-called "charitable effort", which is nothing but a vulture scheme to take advantage of yet more market dislocations and have the octopus grow a few more tentacles in its endless quest of financial monopolist supremacy, will of course be spun as indicative of the dynamic duo's endless humanism. That the squid will have the backing of the greatest US cheerleader in recent history (else those written index puts may rear their ugly head once again), biggest TARP beneficiary, and the largest Goldman shareholder, is also not all that surprising.
Remember those wacky CDO’s that Goldman underwrote, hedged with credit default swaps, then promptly collected 100 cents on the dollar for (courtesy the US taxpayer) after lighting up the AIG switchboard with collateral calls? Kindly, the FRNY released only yesterday its quarterly report on Maiden Lane III.