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How Goldman and D.C. Hosed AIG – and the Taxpayers

11 | By Shah Gilani

The truth about crony capitalism, at the highest level, is being laid bare right before our eyes.

I’m talking here about Goldman Sachs Group Inc. (NYSE: GS) as the husband of global investment banking prowess with the U.S. government as its mistress puppet.

Maybe there is hope that the Goldman Government can be brought down.

Okay, I was pushing it there. That’s not going to happen in this century.

But here’s what is happening…

A Little Light Shines In

The public is finally getting a look inside the black box where the titans of Wall Street and their inside-jobbers in Congress and at the highest levels of the U.S. government plot their profiteering and pilfering schemes.

Remember Starr International suing the United States for essentially ripping off American International Group Inc. (NYSE: AIG) and its shareholders? Starr is an insurance company controlled by Maurice “Hank” Greenberg, the former CEO of AIG, not long ago the largest insurance company in the world.

I told you about it back in September.

Apparently, this closely watched 37-day trial that was supposed to have ended in November, is far from over.

Greenberg’s lawyers just got more than 30,000 new documents they were denied before.

And, oh boy, are they a powder keg!

What was covered up when the U.S. government and the Federal Reserve Bank of New York bailed out AIG (as the Fed and the government called it) was how Goldman Sachs inserted one of its directors, Edward Liddy, into the top position at AIG when the government saved it from itself.

Only no one knew how deep the Goldman connection went. No one knew how Liddy, the former CEO of Allstate Corp. (NYSE: ALL), helped push through the bailout with the AIG board – without giving shareholders a chance to vote on it.

The problem for the New York Fed, the U.S. government and Goldman Sachs was that Greenberg’s stock position was enough to kill the bailout if he had a chance to vote his shares. He never got the chance.

It wasn’t enough that Goldman’s former CEO was Hank Paulson, the then-Secretary of the U.S. Treasury, and that Goldman got bailed out itself when the Fed and the U.S. government gave it a windfall of profits right out of AIG’s pocketbook for some credit-default swaps that weren’t even worth anywhere near what the government paid Goldman for them. That was theft, plain and simple.

But, hey, it’s not theft if its government sanctioned.

So, we’re finding out now how deep the rabbit hole is.

The best report I’ve read so far is the New York Times account of it.

For the most part, the trial was a sleeper. Not anymore. These new revelations change everything.

At least, we hope they do.

Related Reports:

Wall Street Insights & Indictments: The $40 Billion Circus Has Arrived.

11 Responses to How Goldman and D.C. Hosed AIG – and the Taxpayers

    • robbe says:

      Lets keep this short and run through pass to chase. only the people w AIG had the inside info. about what would happen if the insurance co. failed. lets go back when the Govt. funded the bail out how many exec. got paid NOT THE WORKERS….that right here show where their interest was….ITS A GREAT SCAM when u r on the receiving end. I say lets hang the bustards on the town square,,,,,and let them feel some REAL PAIN>

  1. Kevin Beck says:

    This may be old facts; however, it is very relevant news to everyone today. When we have the scum of the earth being saved by their government goons (I mean, lackeys), we are looking corruption straight in the eyes. And now is NOT the time to blink. If you do, you will miss it all. Apparently, that’s what the author of the previous post wants to do.

    As the article points out, the government is not supposed to engage in theft. However, since the government’s only product is force, it will engage in theft all day long until it is stopped.

    My hope is that this case will blow up all the government’s crony criminalism being inflicted through the financial markets for all to see, clearly and brightly. Then maybe this mayhem can stop.

  2. Robert in Vancouver says:

    An interesting and disgusting side note to the article is the partnership between Goldman Sachs and Al Gore.

    They jointly own a carbon trading company that sells carbon off-sets to companies and governments. It’s a scam. In return for getting vast sums of money, some trees are promised to be planted in a 3rd world country, or some other un-verifiable promise.

    There is no method of verifying if the trees were planted, verification documents are forged or fabricated out of thin air, and the money made by Goldman-Gore goes into offshore tax-free bank accounts. Some of the money gets ‘donated’ to the Democratic Party in the USA in return for maintaining the legal requirement to reduce carbon emissions and buy carbon off-sets.

    If you don’t believe me, follow the money.

    Google Vivian Krause and read the facts she has uncovered about this ‘inconvenient truth’.
    She is an environmentalist who evolved into a crusader to uncover the truth about unscrupulous crooks inside the enviro industry.

  3. George says:

    What you say is true, but what you neglect it that AIG sold its soul in the process with its backing of the securities. That along with the rating agencies gave Goldman and others like them the ammo to sell these fraudulent packages. The price of the insurance was peanuts compared to the profits that could be made. And if you try to tell me that AIG was duped, then they should have been allowed to go under.

    Poor Greenberg. Please point out how much money he made out of this, More than he could ever spend.

    This whole episode with him is like the kids who kill their parents, then ask the courts for mercy because they are orphans.

    Poor Greenberg

  4. ALAN STEINBRONN says:

    Greenberg & Group never liked the fact that they were treated like insignificant peons by the United States of Goldman Sachs.

    While the United States of Goldman Sachs were complete FOOLS for blowing their ‘client-attorney’ cover. You can be certain those brainless Goldman strategists are being treated ‘CIA style’ in a dark damp smelly basement somewhere.

    Now the ‘nastiness’ of the Pillars of Society gets aired out in public view.

    Bottomline – Greenberg and Group will get their ‘payoff’ and the Public Herd will continue their daily toil under the GRAND GUIDANCE of The United States of Goldman Sachs.

  5. Lawrence Cunningham says:

    Hank Greenberg and I provided all of those details in chapter 18 of our 2012 book, The AIG Story. It’s ironic that it takes a legal case to get the world’s attention to these facts. But thanks for highlighting them.

  6. Davidme says:

    This is just the very tip of a growing Iceberg out of Washington DC ( District Of Corruption) !!! The Terrifying Fact Seems to be there is No One Willing Nor Able to Stop all this TYRANNY Against AMERICA, Our Constitution and Our Freedom !!!! The Supreme Court has been Compromised, Our Military is being Compromised, Our Constitution is being Compromised, Our National Security and Economy is being Compromised by ILLEGAL IMMIGRATION and Open Borders, The IRS, Home Land Security, Department Of “Justice”, The Pentagon and Above All Our congress are all Compromised !!! To top it all off We Have A TRAITOR In The OVAL Office Who Hates Everything About America !!!! So why care so much about AIG and Goldman Sachs, which is a Very Small Part of the Much, Much Bigger Picture !!!! I believe all the above stated issues and likely more I left out are part of a HUGE Conspiracy to Destroy America !!!! The TRAITOR in the Oval Office is the Mouth Piece likely Backed by the UN, Soros ( The New Worlds Order Guy), muslim Influence and/or Others !!!

    MAY GOD HELP US ALL SAVE AMERICA, OUR CONSTITUTION AND FREEDOM !!

  7. Joe says:

    This case must redeem the shareholders who lost their rights of ownership while GS and other banks walked away with every penny they were owed. A plaintiffs victory is the only way to help curb government largess and fraud….only light can defeat darkness.

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