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the us$185 billion bailout of aig..

  1. 24,765 Posts.
    ".... As fraud investigators, we would like to examine the trading patterns of A.I.G.s financial products division, and its communications with Goldman Sachs and other bank counterparties who benefited from the bailout. We would like to understand whether the leaders of A.I.G. understood that they were approaching a financial Armageddon, and whether they alerted their counterparties, regulators and shareholders to the impending calamity.

    We would like to see how A.I.G. was able to pay huge bonuses to its officers based on the short-term income they received from counterparties for selling guarantees that, lacking adequate loss reserves, the companies would never be able to honor. We would also like to know what regulators knew, and what they did with the information they had obtained.

    Congress wants answers, too. This month, during hearings on Ben Bernankes nomination to a second term as chairman of the Federal Reserve, several senators fumed about being denied access to his A.I.G.-related documents.

    No doubt, some of the e-mail messages contain privileged conversations among lawyers. Others probably include private information that is irrelevant to A.I.G.s role in the crisis. But the vast majority of these documents could be made public without legal concern. So why havent the Treasury and the Federal Reserve already made sure the public could see this information? Do they want to protect A.I.G., or do they worry about shining too much sunlight on their own performance leading up to and during the crisis?..."

    The full article, Show Us the E-Mail by Eliot Spitzer, Frank Partnoy and William Black is at http://www.nytimes.com/2009/12/20/opinion/20partnoy.html?_r=2&hp
 
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