Monday, March 16, 2009

The free market : it isn't free and it isn't a market

"The American International Group, which has received more than $170 billion in taxpayer bailout money from the US Treasury and Federal Reserve, plans to pay about $165 million in bonuses to executives in the same business unit that brought the company to the brink of collapse last year. The payments to A.I.G.’s financial products unit are in addition to $121 million in previously scheduled bonuses for the company’s senior executives.

A.I.G.’s main business is insurance, but the financial products unit sold hundreds of billions of dollars’ worth of derivatives, the notorious credit-default swaps that nearly toppled the entire company last fall.
A.I.G. had set up a special bonus pool for the financial products unit early in 2008, before the company’s near collapse, when problems stemming from the mortgage crisis were becoming clear and there were concerns that some of the best-informed derivatives specialists might leave.
Edward M. Liddy, the government-appointed chairman of A.I.G., argued that some bonuses were needed to keep the most skilled executives."

AIG loss in 2008 was $99.3 billion.

Fin. Times : "Goldman Sachs Group Inc and 22 European banks were the major beneficiaries of US$93-billion in payments from AIG -- more than half of the U.S. taxpayer money spent to rescue the massive insurer."

Goldman Sachs was formerly led by Henry Paulson who was treasury secretary at the time of the original AIG bailout.

Michael Parenti : "They don't mind recessions. Recessions are fine. It allows them to buy up smaller companies at bargain prices. It disciplines labor. It humiliates and beats back people. And this, I think, is what we're facing.
And it's not merely because of a number of wicked personalities, because these personalities are brought to the fore. Those are the people who get the rewards.
The free market does not work. It's not free. It's not really a market; it's a plunder. And it has to be done away with."
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3 comments:

Anonymous said...

The bonus payout excesses at AIG are just the tip of the iceberg of what is happening with the other Wall Street bailouts including Bank of America. Working productive Americans are bailing out the same crooks that destroyed our economy along with 45% of the wealth in the world and now the American taxpayers and our children will be forced to live a far lower standard of living with reduced prosperity and opportunities due to this but only we pay the price.

Washington has bailed out the banks, Wall Street & their Washington special interests and much of the cost is added to the national debt to by paid by this and future generations while real estate and investments continue to fall. Find out what a growing repudiate the debt movement could mean for treasuries, the dollar, gold and the stock market and how this is a better alternative than Washington’s plans to monetize the debt in future years and tax and destroy our remaining wealth by depreciating the dollar.

The Campaign to Cancel the Washington National Debt By 12/21/2012 Constitutional Amendment is starting now in the U.S. See: http://www.facebook.com/group.php?gid=67594690498&ref=ts

harpervalley said...

wow, i landed at creekside and you've changed the place around....i kinda liked the sofa better under the window, but, er, well, a vain attempt at humour during these RAINY COLD days we are persevering. still.....better then snow and so much below :D

hey alison, wishing you aloha. i'm actually staying in a HOUSE, which came just before the torrential rains and my van being soaked from corner to corners. all i do is a few hours of cleaning and other chores, et voila, a roof over my head and a bathroom!!!! i know , i'm getting pretty luxurious but i'll try keep the snob factor down :D

Alison said...

Aloha, honeybunch - bourgeois lookin good on you.
Snowed here yesterday. Snow.

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