AIG Paid off Silverstein on Twin Towers TWICE after 9/11

A.I.G. Using "Suicide Strategy" to Push Bonuses

Tuesday 17 March 2009

by: Matt Renner, t r u t h o u t | Report

A.I.G. Using “Suicide Strategy” to Push Bonuses

March 18, 2009 By: Freedom Fighter Category: government corruption

No one mentions that AIG was the insurance company that insured the Twin Towers SPECIFICALLY against terrorism a month or so before 9/11 happened, and then paid off on the towers’ collapses TWICE based on a friendly lawsuit between friends Larry Silverstein (who owned the Towers) and his buddy Maurice Greenberg, (CEO/owner of AIG) ????

So it would seem that AIG is right in the middle of things, such as THREATS, ATTACKS, etc.—and has been for some time.

Anybody at T.O. care to spend a bit of time connecting THOSE dots?????

A.I.G. Using “Suicide Strategy” to Push Bonuses

Tuesday 17 March 2009

by: Matt Renner, t r u t h o u t | Report

Source: TruthOut

Washington, DC - As nationwide populist anger boils after the news that hundreds of millions of taxpayer dollars may be given to employees of the insurance-giant-turned-government-liability American International Group (A.I.G.), President Obama promised to try to block what he described as an “outrage” Monday, but a group of former regulators said the administration must get even tougher with A.I.G.

“[A.I.G.] is a corporation that finds itself in financial distress due to recklessness and greed. Under these circumstances, it’s hard to understand how derivative traders at A.I.G. warranted any bonuses, much less $165 million in extra pay. I mean, how do they justify this outrage to the taxpayers who are keeping the company afloat?” Obama said, adding, “I’ve asked [Treasury] Secretary Geithner to use that leverage and pursue every single legal avenue to block these bonuses and make the American taxpayers whole.”

$165 million is set to be paid to executives of A.I.G.’s financial products division, the same people who made unregulated bets against the failure of major financial institutions and other companies. Losses on these bets are a major reason the company is failing, reporting a record-setting $60 billion loss last quarter.

Economics and law Professor William K. Black, a famous figure in the savings and loan crisis of the 1980s for his role as a senior regulator who fingered the then speaker of the House and “The Keating Five” for doing favors for bankers, has been a vocal critic of the bailout programs, which began during the Bush administration.

In an interview with Truthout, Professor Black said that A.I.G. is using a “suicide strategy” to hold the government hostage and keep the bailout funds flowing.

“A.I.G. is holding a gun to their own heads, saying ‘unless you help us continue to have this incredible life in terms of bonuses, we’re going to die and the taxpayers will be faced with a catastrophe,’” Professor Black said, adding “It’s too bad Marxists don’t believe in god. Otherwise they’d be thanking him for having sent A.I.G. down to earth to destroy capitalism.”

Earlier on Monday, Professor Black joined three other notable analysts with deep industry, regulatory and academic experience in issuing a punishing statement calling for decisive action on A.I.G. and the ongoing bailout.

“A.I.G.’s decision to pay out at least $165 million in bonuses takes the bank bailout program’s abuse of the public trust to a whole new level. This act simply cannot be allowed to stand. The only question is how to stop it,” the statement said.

The plan to stop the bonuses would require bold action by government officials overseeing A.I.G., which is now 80 percent owned by the government after being given 173 billion taxpayer dollars to bail the company out.

The statement called on the Obama administration to reassert its leverage in the A.I.G. matter by ordering the US officials overseeing the company to stop bonus payments. Then, the government could split off A.I.G.’s derivatives unit - the riskiest part of the company, which brought about A.I.G.’s collapse - and threaten to allow it to go into bankruptcy if the executives don’t clean up their act.

In other words, the statement advised the Obama administration to call A.I.G.’s bluff and see if they’ll really pull the trigger.

In their defense, A.I.G. said that they are contractually obligated to pay the bonuses in question. Not paying these bonuses, the company said, would cause their executives to leave the company and could trigger a collapse at A.I.G., which could set off a collapse around the world.

Credit Default Swaps

The derivatives unit at A.I.G. trafficked heavily in financial products called credit-default swaps (CDSs). Originally devised as a type of insurance, CDSs morphed into an unregulated form of gambling akin to being able to take out fire insurance on a house you don’t own and getting paid if the house burns. Because major financial institutions were betting on billion-dollar companies, and betting with each other on each other, their fates are bound together by these bets. If one company goes into bankruptcy, it could set off a string of default swaps and could fold the whole system in on itself.

Documents released by A.I.G. on Sunday show that $43 billion in taxpayers’ money has been spent by A.I.G. to pay off financial bets to both US and international banks with a whopping $13 billion going to the politically connected Wall Street giant Goldman Sachs.

The documents directly contradict a statement made during a conference call with stock market analysts by Goldman Sachs chief financial officer David Viniar, who said that Goldman was only immaterially at risk if A.I.G. failed.

The CDS market has an approximate value of 50 trillion dollars worldwide. Critics charge that this massive, complicated and extremely murky market continues to hover over the heads of the global financial system like the blade of a guillotine with the banks holding the executioners rope, daring the government to stop funding their bailouts. Read Full Article

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