Home › Forums › Financial Markets/Economics › The View From Inside a Depression
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briansd1.
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October 19, 2009 at 4:56 PM #471920October 19, 2009 at 5:04 PM #471086
SD Realtor
ParticipantI will try to find it.
Any Piggs recall the link to the rolling stones article about AIG? It was a thread all its own but a very nice writeup.
October 19, 2009 at 5:04 PM #471266SD Realtor
ParticipantI will try to find it.
Any Piggs recall the link to the rolling stones article about AIG? It was a thread all its own but a very nice writeup.
October 19, 2009 at 5:04 PM #471625SD Realtor
ParticipantI will try to find it.
Any Piggs recall the link to the rolling stones article about AIG? It was a thread all its own but a very nice writeup.
October 19, 2009 at 5:04 PM #471703SD Realtor
ParticipantI will try to find it.
Any Piggs recall the link to the rolling stones article about AIG? It was a thread all its own but a very nice writeup.
October 19, 2009 at 5:04 PM #471925SD Realtor
ParticipantI will try to find it.
Any Piggs recall the link to the rolling stones article about AIG? It was a thread all its own but a very nice writeup.
October 19, 2009 at 5:07 PM #471091Arraya
Participant[quote=ucodegen]
Semantics, it all came from the taxpayer. Specifically, the AIG went directly from Tarp to Goldman. Oh, but it was default swaps so it’s ok????
The semantics are what is important.. which side of the loan.. who owes who money.. its all semantics. The only way to prevent this transfer was to have AIG go under.. which would have caused more than $137Billion in underwritten CDS to go under.. affecting several other banks that also bought CDSs from AIG.
Specifically, AIG was insuring loans that Goldman had underwritten. Goldman was paying AIG money to do this. Goldman thought there was a possibility of the loans going bad, so they bought insurance on the principal of the loan.. this loan is known as a Credit Default Swap. Same semantic that brought down Bear Stearns.. they were on the wrong end of the Credit Default Swap.
My personal opinion is that the Fed should have allowed AIG to fail, to take possession of AIG and make the CDS(s) that it did originate good. Sell off the other parts of AIG to clear up the loss. Several banks understood the risk of the loss of principal and took out insurance, paying into AIG so that if the loan went bad, they could at least get their principal back.[/quote]
Yeah, I understand the systemic risk of AIG. Still, taxpayer money went to pay Goldman’s seemingly always correct bets. Just because things would have went haywire if GS did not get payed DOES NOT mean they are not receiving taxpayers funds. The taxpayer is still funding a casino. It’s gambling plane and simple. People tend to bet big when they know they can’t lose.
October 19, 2009 at 5:07 PM #471271Arraya
Participant[quote=ucodegen]
Semantics, it all came from the taxpayer. Specifically, the AIG went directly from Tarp to Goldman. Oh, but it was default swaps so it’s ok????
The semantics are what is important.. which side of the loan.. who owes who money.. its all semantics. The only way to prevent this transfer was to have AIG go under.. which would have caused more than $137Billion in underwritten CDS to go under.. affecting several other banks that also bought CDSs from AIG.
Specifically, AIG was insuring loans that Goldman had underwritten. Goldman was paying AIG money to do this. Goldman thought there was a possibility of the loans going bad, so they bought insurance on the principal of the loan.. this loan is known as a Credit Default Swap. Same semantic that brought down Bear Stearns.. they were on the wrong end of the Credit Default Swap.
My personal opinion is that the Fed should have allowed AIG to fail, to take possession of AIG and make the CDS(s) that it did originate good. Sell off the other parts of AIG to clear up the loss. Several banks understood the risk of the loss of principal and took out insurance, paying into AIG so that if the loan went bad, they could at least get their principal back.[/quote]
Yeah, I understand the systemic risk of AIG. Still, taxpayer money went to pay Goldman’s seemingly always correct bets. Just because things would have went haywire if GS did not get payed DOES NOT mean they are not receiving taxpayers funds. The taxpayer is still funding a casino. It’s gambling plane and simple. People tend to bet big when they know they can’t lose.
October 19, 2009 at 5:07 PM #471630Arraya
Participant[quote=ucodegen]
Semantics, it all came from the taxpayer. Specifically, the AIG went directly from Tarp to Goldman. Oh, but it was default swaps so it’s ok????
The semantics are what is important.. which side of the loan.. who owes who money.. its all semantics. The only way to prevent this transfer was to have AIG go under.. which would have caused more than $137Billion in underwritten CDS to go under.. affecting several other banks that also bought CDSs from AIG.
Specifically, AIG was insuring loans that Goldman had underwritten. Goldman was paying AIG money to do this. Goldman thought there was a possibility of the loans going bad, so they bought insurance on the principal of the loan.. this loan is known as a Credit Default Swap. Same semantic that brought down Bear Stearns.. they were on the wrong end of the Credit Default Swap.
My personal opinion is that the Fed should have allowed AIG to fail, to take possession of AIG and make the CDS(s) that it did originate good. Sell off the other parts of AIG to clear up the loss. Several banks understood the risk of the loss of principal and took out insurance, paying into AIG so that if the loan went bad, they could at least get their principal back.[/quote]
Yeah, I understand the systemic risk of AIG. Still, taxpayer money went to pay Goldman’s seemingly always correct bets. Just because things would have went haywire if GS did not get payed DOES NOT mean they are not receiving taxpayers funds. The taxpayer is still funding a casino. It’s gambling plane and simple. People tend to bet big when they know they can’t lose.
October 19, 2009 at 5:07 PM #471708Arraya
Participant[quote=ucodegen]
Semantics, it all came from the taxpayer. Specifically, the AIG went directly from Tarp to Goldman. Oh, but it was default swaps so it’s ok????
The semantics are what is important.. which side of the loan.. who owes who money.. its all semantics. The only way to prevent this transfer was to have AIG go under.. which would have caused more than $137Billion in underwritten CDS to go under.. affecting several other banks that also bought CDSs from AIG.
Specifically, AIG was insuring loans that Goldman had underwritten. Goldman was paying AIG money to do this. Goldman thought there was a possibility of the loans going bad, so they bought insurance on the principal of the loan.. this loan is known as a Credit Default Swap. Same semantic that brought down Bear Stearns.. they were on the wrong end of the Credit Default Swap.
My personal opinion is that the Fed should have allowed AIG to fail, to take possession of AIG and make the CDS(s) that it did originate good. Sell off the other parts of AIG to clear up the loss. Several banks understood the risk of the loss of principal and took out insurance, paying into AIG so that if the loan went bad, they could at least get their principal back.[/quote]
Yeah, I understand the systemic risk of AIG. Still, taxpayer money went to pay Goldman’s seemingly always correct bets. Just because things would have went haywire if GS did not get payed DOES NOT mean they are not receiving taxpayers funds. The taxpayer is still funding a casino. It’s gambling plane and simple. People tend to bet big when they know they can’t lose.
October 19, 2009 at 5:07 PM #471930Arraya
Participant[quote=ucodegen]
Semantics, it all came from the taxpayer. Specifically, the AIG went directly from Tarp to Goldman. Oh, but it was default swaps so it’s ok????
The semantics are what is important.. which side of the loan.. who owes who money.. its all semantics. The only way to prevent this transfer was to have AIG go under.. which would have caused more than $137Billion in underwritten CDS to go under.. affecting several other banks that also bought CDSs from AIG.
Specifically, AIG was insuring loans that Goldman had underwritten. Goldman was paying AIG money to do this. Goldman thought there was a possibility of the loans going bad, so they bought insurance on the principal of the loan.. this loan is known as a Credit Default Swap. Same semantic that brought down Bear Stearns.. they were on the wrong end of the Credit Default Swap.
My personal opinion is that the Fed should have allowed AIG to fail, to take possession of AIG and make the CDS(s) that it did originate good. Sell off the other parts of AIG to clear up the loss. Several banks understood the risk of the loss of principal and took out insurance, paying into AIG so that if the loan went bad, they could at least get their principal back.[/quote]
Yeah, I understand the systemic risk of AIG. Still, taxpayer money went to pay Goldman’s seemingly always correct bets. Just because things would have went haywire if GS did not get payed DOES NOT mean they are not receiving taxpayers funds. The taxpayer is still funding a casino. It’s gambling plane and simple. People tend to bet big when they know they can’t lose.
October 19, 2009 at 6:09 PM #471126barnaby33
Participantucodegen, if it could be unwound carefully that would be one thing. The only two options are let it unwind or prop it up, we are engaging in option number two. However only for politically well connected entities.
Oh and printing is re-distribution, the sneakiest variety.
October 19, 2009 at 6:09 PM #471306barnaby33
Participantucodegen, if it could be unwound carefully that would be one thing. The only two options are let it unwind or prop it up, we are engaging in option number two. However only for politically well connected entities.
Oh and printing is re-distribution, the sneakiest variety.
October 19, 2009 at 6:09 PM #471666barnaby33
Participantucodegen, if it could be unwound carefully that would be one thing. The only two options are let it unwind or prop it up, we are engaging in option number two. However only for politically well connected entities.
Oh and printing is re-distribution, the sneakiest variety.
October 19, 2009 at 6:09 PM #471743barnaby33
Participantucodegen, if it could be unwound carefully that would be one thing. The only two options are let it unwind or prop it up, we are engaging in option number two. However only for politically well connected entities.
Oh and printing is re-distribution, the sneakiest variety.
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