AIG

Bloomberg out with an article disclosing what every "tinfoil" hat wearer has known for a long time, namely that it was precisely Goldman's collateral extractions out of AIG that were the cause for the firm's collapse, and the ensuing financial catastrophe that to this day has been propped up only thanks to the US government's backstop of nearly $10 trillion in various worthless assets.

In a fitting redux of the Japan real-estate invasion (which Colin Powell had some hilarious comments on at last year's JPM High Yield megaconference in South Beach), South Korean firms Youngwoo & Associates and Kumho Investment Bank have acquired the AIG headquarters at 70 Pine St and 72 Wall St, for a total price in the neighborhood of $100 million, a third of what these could have sold for two years ago. AIG itself will continue occupying the 1.4 million sq.

As Zero Hedge initially reported nearly two months ago, the main reason why the banks' fixed income trading desks generated phenomenal profitability in January and February had nothing to do with actual trading of fixed income and everything to do with AIG's hamheaded (and loss-generating) unwind of its CDS book, which by implication generated one-time, massive profits for counterparties to the trade (read: the banks, which are now doing all they can to issue shares in the open market day in and da

Let's recall what the magical bonus number was that caused Barney Frank to almost get a lynch mob armed and ready to march on Wall Street: $165 million in retention bonuses.

This is kinda a huge deal... Peter Fisher, managing director of BlackRock (yes, that BlackRock), states in a Bloomberg interview that Goldman's first quarter trading profit is non-recurring in nature, and believes it was mostly due to AIG unwinds... It is a little shocking that BlackRock would have anything bad to say about the phenomenal resurrection of financial companies, and puts the huge "profit" in it's true light.

As Zero Hedge reported first, strange things happened in January and February when AIG was allegedly unwinding CDS trades with its trading counterparties. As we reported, the taxpayer funded loss that AIG presumably experienced on wholesale CDS unwinds may have well been the reason for the banks' reported trading profitability in the first 2 months of the year.

WSJ reports that Members of Congress have asked federal authorities for confidential reports prepared by a lawyer charged with monitoring AIG's business practices over the past four years.

The request, dated Monday, expands the scope of the congressional investigation into AIG's collapse and subsequent federal rescue in September. The request was made by the House Committee on Oversight and Government Reform in letters sent to both the Department of Justice and Securities & Exchange Commission.

Zero Hedge is rarely speechless, but after receiving this email from a correlation desk trader, we simply had to hold a moment of silence for the phenomenal scam that continues unabated in the financial markets, and now has the full oversight and blessing of the U.S. government, which in turns keeps on duping U.S. taxpayers into believing everything is good.

I present the insider perspective of trader Lou (who wishes to remain anonymous) in its entirety:

Or so reports the WSJ. The attorney general has proven to be quite successful at getting whatever information he wants (especially with public lynching as a negotiating tool), so the entire credit community is drooling in anticipation to find out just how scary the real picture at AIG FP's global operations truly is (ZH is quite curious what the DV01 on AIG's entire portfolio is).

Earlier, I discussed the return by Chris Dodd of his AIG campaign contributions, which recently had amounted to over $100,000. CNSnews is reporting that the return of AIG contributions is only now starting to pick up, after Republican Mike Pence started a campaign for full refunding.

Among the individuals implicated are:

Sen. Chris Dodd (D-Conn.), $103,100; (Some more on Chris here)

Populist anger level reduced to deep orange from bright red.

Chris Dodd has taken Zero Hedge's advice and has decided to refund his campaign contributions from not only criminals with a record, and destroyers of the free market such as Joe Cassano but everyone else at AIG.

A very rare glimpse into the real daily inside occurrences at AIG. And some very scary news for other (re)insurance companies. A must read for everyone and the Mainstream Media as well... If anyone has comparable insider stories please let Zero Hedge know.

Compliments of ole Barney Frank, here is the AIG retention contract in all its glory. Always best to hear it straight from the financial singularity's mouth.