What would you think about the Federal Reserve Bank of New York telling AIG to intentionally withheld from public scrutiny that AIG was paying 100 cents on the dollar for credit default swaps at the same time that AIG was crying for a bailout from the public, thereby hiding from the public that the public was functionally bailing out Goldman Sachs and other large banks? What would you think about the fact that Tim Geithner headed the New York Federal Reserve when this was going on? Eliot Spitzer, William K. Black and Frank Partnoy sum up the issue:
Today, a Bloomberg story revealed that under Timothy Geithner’s leadership, the Federal Reserve Bank of New York told AIG to withhold details from the public about its payments to banks during the crisis. This information was discovered when emails between the company and the Fed were requested by representative Darrell Issa, ranking member of the House Oversight and Government Reform Committee.
Who owns AIG? The taxpayers own 80% of it. Therefore, AIG should release the emails. Who can and should make this decision?
The taxpayer’s stake in AIG is held by the A.I.G. Credit Facility Trust, whose three trustees are Jill M. Considine, a former chairman of the Depository Trust Company and a former director of the Federal Reserve Bank of New York; Chester B. Feldberg, a former New York Fed official who was chairman of Barclays Americas from 2000 to 2008; and Douglas L. Foshee, chief executive of the El Paso Corporation and chairman of the Houston branch of the Federal Reserve Bank of Dallas. We call on these three officials (interestingly all former Fed officials) to immediately release the documents we request. The value of these documents, if it were ever in doubt, was certainly proved by today’s revelations.
Release the emails.
See also, this earlier post on a NYT op-ed by Spitzer, Black and Partnoy.
Frank Rich sees Wall Street as a ticking time bomb that will explode again, unless the 2008 economic meltdown is thoroughly probed in the upcoming hearings by the Financial Crisis Inquiry Commission, so that meaningful reforms can be implemented. Rich is not optimistic that these hearings will be meaningful, however. The banks have the power to stifle the entire process. For instance, the chairman of the Commission is Tim Johnson of South Dakota, "home to Citi’s credit card operation. Johnson was the only Senate Democrat to vote against Congress’s recent bill policing credit card abuses."
Rich scoffs at a recent statement by Sandy Weill, the former chief executive who built Citigroup, who has portrayed himself as a philanthropist:
"Among his causes is Carnegie Hall, where he is chairman of the board. To see how far American capitalism has fallen, contrast Weill with the giant who built Carnegie Hall. Not only is Andrew Carnegie remembered for far more epic and generous philanthropy than Weill’s — some 1,600 public libraries, just for starters — but also for creating a steel empire that actually helped build America’s industrial infrastructure in the late 19th century. At Citi, Weill built little more than a bloated gambling casino. As Paul Volcker, the regrettably powerless chairman of Obama’s Economic Recovery Advisory Board, said recently, there is not “one shred of neutral evidence” that any financial innovation of the past 20 years has led to economic growth. Citi, that “innovative” banking supermarket, destroyed far more wealth than Weill can or will ever give away."
http://www.nytimes.com/2010/01/10/opinion/10rich….
Dylan Ratigan reads the full indictment of Tim Geithner here: http://www.huffingtonpost.com/huff-tv/watch-ratig…
And note the way in which Ratigan shows little patience for Brad Sherman's many evasions of the basic topic. I'm all for this method of moderating an interview. So very unlike Tim Russert–thank goodness. When someone refuses to answer the question, note that refusal for the record. That's what happened here, and look how Sherman finally gave a modestly clear answer at the very end of the interview.