"Reports name AIG's derivative counterparties
NEW YORK (AP) — The federal bailout of insurance giant American International Group Inc. has benefited at least two dozen U.S. and foreign financial institutions who collected some $50 billion, according to media reports Saturday.
AIG — once the world's largest insurer — is paying money to its counterparties because it had agreed to guarantee them against losses from credit default swaps they had invested in.
As bloggers have pointed out, those bank rip-offs are killing us all.
"In the 1990s, the T and other transit agencies were encouraged by federal officials to sell their train equipment to banks and then lease it back. The arrangement brought the T $53 million in upfront payments. In return, the private banks realized a tax benefit"
"The authority was attempting to renegotiate terms of a complex financial deal with the banking giant UBS. Known as a swaption, the arrangement could force the authority to pay out a $450 million lump sum"
NOT a GOOD IDEA at all!!! Thanks, Bill Clinton!
"During the go-go investing years, school districts, transit agencies, and other government entities were quick to jump into the global economy, hoping for fast gains to cover growing pension costs and budgets without raising taxes. Deals were arranged by armies of persuasive financiers who received big paydays. But now, hundreds of cities and government agencies are facing economic turmoil"Related: Swapping Partners Good For Health
Also consider:
"Senate agrees to back Pike rate-swaps
The state Senate voted 33 to 5 yesterday to approve legislation reinstating the state's credit backing behind risky interest-rate swap agreements the Massachusetts Turnpike Authority had used to help finance the Big Dig. The state backing is intended to prevent taxpayers and tollpayers from getting stuck with a $363 million termination payment from the investment firm UBS, but it does not guarantee that outcome. The final version of the legislation authorizes Treasurer Timothy P. Cahill to join Patrick administration officials as they attempt to negotiate with UBS to avoid the balloon payment, which UBS could demand if Standard & Poor's downgrades the credit rating of turnpike insurer Ambac Assurance Corp (State House News Service)."
See: State Biting the Hand That Steals From It
This is why the sh***ers need to raise the gas tax: to pay off banks for their mistakes.
Citing a confidential document and people familiar with the matter, The Wall Street Journal said recipients of AIG money include Goldman Sachs Group Inc. and Germany's Deutsche Bank AG, each of which received roughly $6 billion in payments between mid-September and December 2008.
As Americans were struggling and being being bent over.
Also receiving AIG money last year were Merrill Lynch, now part of Bank of America Corp., French bank Societe Generale SA and, to a lessor extent, Morgan Stanley, Royal Bank of Scotland Group PLC and HSBC Holdings PLC, the newspaper said.
I just want to know when America rips these guys a new a**hole.
Meanwhile, business magazine Fortune on Saturday issued its own list of 15 banks that received AIG money, including: Calyon, Credit Agricole of France; UBS; Barclays; Coral Purchasing, DZ Bank of Germany; Bank of Montreal; Rabobank of the Netherlands. Fortune, which credited a "reliable source," did not supply dollar amounts that each bank received.
Related: Whatever Happens in Switzerland Stays in Switzerland
The disclosures come the same week the Fed refused a congressional request for the names of all AIG's derivative counterparties.
But they got oversight, blah, blah, blah, blah.
At a hearing Thursday, Federal Reserve Vice Chairman David Kohn declined to reveal who had been made whole after deals with AIG went bad, arguing that the information would undermine what little confidence remains in the financial markets.
And we would likely want to string up those involved, too, because no one has confidence in these markets now!!!
AIG on Monday reported a $61.7 billion quarterly loss, the worst in U.S. history. The same day, Treasury provided AIG as much as $30 billion in additional aid from the $700 billion financial bailout program, bringing the company's total bailout to more than $170 billion since September. The government now owns nearly 80 percent of the company.
Which means the TAXPAYER is INSURING HIMSELF, right?
AIG has been forced to seek more help in part because of the ongoing recession and its falling stock price, now well under $1. Among its biggest problems: It can't sell assets to pay back government loans because the credit crisis is preventing would-be buyers from getting financing to complete such deals.
Sort of like a vicious circle, almost as if its being done on purpose -- which is exactly what was done!
And honestly, I could give a s*** about AIG's problems.
A representative with New York-based AIG wasn't immediately available to comment.
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