He Did What!?!

Timothy Geithner did what was he was President of Federal Reserve Bank of New York? Well according to this Bloomberg report the NY Fed, led by Mr. Geithner:

told American International Group Inc. to withhold details from the public about the bailed-out insurer’s payments to banks during the depths of the financial crisis, e-mails between the company and its regulator show.

AIG said in a draft of a regulatory filing that the insurer paid banks, which included Goldman Sachs Group Inc. and Societe Generale SA, 100 cents on the dollar for credit-default swaps they bought from the firm. The New York Fed crossed out the reference, according to the e-mails, and AIG excluded the language when the filing was made public on Dec. 24, 2008.

Make sure you are sitting down when you read this story and if you have high blood pressure that you take your medicine before reading it.

I am not aware of any exceptions in SEC's public disclosure rules regarding hiding the fleecing of U.S. taxpayers or even political embarrassment. This is bad but it continues the pattern of Mr. Geithner's that he worked hard to protect the financial oligarchy during this crisis. But is that the job of the President of NY Fed? If it is, Mr. Geithner did a great job.

But is it the U.S. Treasury Secretary's job to protect the financial oligarchy? Certainly NOT! But that is what is still happening and Mr. Geithner is leading the way. So much for CHANGE!

BTW - naked capitalism has good follow up post to this story: Geithner's Dubious AIG Cover Up.

E-mails from N.Y. Fed to A.I.G. to Not Disclose Counterparty Payments

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I was going to say he should be forced to resign but

I remembered we are in the Era of No Accountability. He will continue in his job so why waste the bytes. Oops.

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Resign?

For general incompetence and corruption he should get a Medal of Freedom.
That's the pattern that has been set anyway.

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Federal Reserve

We covered some of this earlier but Bloomberg's new story, with the corresponding emails, puts more direct evidence on Geithner.

Here's the thing I find interesting, if one notes, this is the Federal Reserve, where Bernanke has claimed they were not involved in the BoA-Merrill Lynch deal.

hmmmmm, if they are this involved in AIG, why would they not have been involved in that as well?

Geithner should be fired. He should have never been hired.

Note the date of the press release, Dec. 24, 2008.

Now what news was released this year on Christmas Eve.?

The Fannie/Freddie unlimited bail out.

Then this line:

The e-mails span five months starting in November 2008 and include requests from the New York Fed to withhold documents and delay disclosure

and then Geithner said AIG should not release any information on synthetic CDOs?

reflects your client’s desire that there be no mention of the synthetics in connection with this transaction,” Shannon wrote to Davis Polk on Dec. 2, 2008. “They will not be mentioned at all

My question is how do we see the original emails?

Is this part of Bloomberg's FOIA or are they somewhere?

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Congressman Issa must have them

according to Bloomberg report:

The e-mails were obtained by Representative Darrell Issa, ranking member of the House Oversight and Government Reform Committee.

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Maybe it is time to jettison all of the Clinton retreads

including Larry Summers. This of course assumes that Pres. Obama wants real Change.

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No, no, no

That's "chains you can believe in" -- everyone appears to be mixed up about his phrase.....

(Also, that was supposed to be: "Yes, we've been canned!")

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Ok, you twisted my arm. Here are the emails

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good job!

Generally, for all stories, please use the "file attachments" button and upload the original document, paper.

The reason for this is because many documents magically disappear from their original links.

In this case, we're stuck, scribd has downloads disabled, although I can probably grab it if folks want me to.

But generally I hate scribd. It adds another layer of crap when pdf readers work just great and make it much easier to read as well as to quote.

But if you notice, in EI releases, I'm uploading the reports. The reason is and this is especially true on any employment statistics, is the report disappears by the next month or even week.

So, when you're checking statistics, it's hard to go back and find the original, not "revised" and check the actual numbers for consistency. (most interesting!)

So, EP is very different in this regard, in that you can have file attachments to posts and thus reference and save the original document, study, report you're referring to.

We need to watch out for copyright, sometimes someone posts a doc. that's protected and by uploading over here, that gets me an email saying we're violating copyright. but don't worry, if I get those I remove the "offending" document right away and point out that we found it publicly originally.

Using the file attachments also really helps on "shocking details" that the entire Internet is hunting for. Examples are we've had the Congressional websites crashed so you can't read something on them and other sites crashed....

so by putting it locally (always reference the paper and authors, also with graphs, if "borrowing" an original graph from another blog, please give them a link and say who make it) it's much easier to read and load.

We have "unlimited" storage on here so don't worry about that.

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More evidence establishing Mr. Geithner's pattern

of protecting financial oligarchy. I forget until I read Chris Bowers story that Geithner and the Obama Administration outreach to protect Wall Street bonuses.

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email excerpts

Seriously click on the emails, go full screen and enlarge.

ok,

Note there should be no discussion that AIG and the NY Fed. are working to structure anything else at this point

The scribbled notes also clearly show Geithner telling AIG not to release an amendment which shows more risk exposure.

You can clearly see Geithner not only stopping the public exposure that AIG wants many of these contracts plain terminated, but he's trying to hide the NY Fed's involvement, period.

That's how it reads to me.

My question is.....is this plain illegal?

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These emails give some context to the story

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sure do

It's unreal isn't it? There is a company who knows they need to force hair cuts and here's our "government" killing the deal?

If Obama has any clue whatsoever (which I know seriously doubt) that keeping Geithner will guarantee him a 1 term presidency, we will see.

Or does he believe his rhetoric machine will pull him through like it did the election.

I get really pissed actually because I ignored the rhetoric, maybe it's because I have a little awareness of public relations and marketing techniques....and I was digging around in those policy statements, the advisers, the connections and the votes....

and I saw this coming! When I pointed it out, well, I didn't even bother to post on dailykos for I know what the "tribe" would say, but on Open Left (a much better political blog IMHO) there were many aware of what was really happening, but still, so many got the "fever" and ignored all of these warning signs!

How can one expect to change the nation when during an election the entire blogosphere goes into denial because they wish it to be so so badly?

I'm going off on a tangent, but this is yet another reason to stay objective and fact based and find out the details and write about them, even if it's your favorite Rep. out there or your political party or even just blows your mind on your own values system and turns your world upside down.

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As someone who supported Candidate Obama

I understand that campaigning and governing are two very different things but man come on. He was elected with a mandate for change. And what does he do right away - appoints Larry Summers - this was very disturbing to me knowing Summers background/history. Then quickly came Geithner and that was when I lost faith. I knew we were going to get the same old Clinton/DLC/Hamilton Project/neo-liberal bullshit.

Oh, sure, Obama will try to throw a few bones to people who got him elected but as long the financial oligarchy is protected at the end of the day that is what matters. There is huge difference between making campaign promises and not fulfilling them and just plain outright lying.

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my criticism is

I could see Obama would be more "Rubinite" than Hillary in the primary. So, let's say Hillary really was "Rubin light" in comparison to Obama (not to imply at all she was a real reformer here), but my criticism of the "left" is they jump onto candidates and even agendas without doing due diligence.

Even on policy, there isn't a lot of research to find out the real ramifications.

So, during the election the criticism is not only did the left do into denial on Obama's real positions, backers and votes (and policy) but there were many posts which were flat out lies and denials. Case in point is NAFTA, it was very clear from the people to the votes to the position white papers to the advisers Obama would push more bad trade agreements and not renegotiate NAFTA at all.

We had various people claim the opposite, that he would and Hillary wouldn't. Well, the fact was Hillary had more evidence she would than Obama...

so the criticism is people have to stick to policy, to legislation to the details and call it as it is and not rush onto campaign bandwagons believing a candidate is something they are not.

When they do that, they lose power to get policy changed.

The entire blogosphere, instead of going gaga for Obama, could have held out for demands on very specific policy changes and not endorsed anyone.

Same with other candidates. If you want real change, you must demand real change and on top of things one must understand what the real consequences, implications are per policy.

In term of the political front, this was a huge motivator to start EP. Not only was the idea to get more people doing citizen investigation, awareness, details, focused on economics, increase public awareness, participation ...

but to also stop the partisan endorsements, when a particular candidate really is caca, i.e. "all of the above" are caca.

Not to just jump on some bill "title", but to read the bill, understand the real economic ramifications and consequences.

We have all of these blogs, social networking, citizen communication, citizen expose, research and instead of doing proper due diligence on the details with all of these tools..

they were simply incorporated into a massive public relations/marketing agenda. That's not real change.

I mean the fight was to gain control of government and this was achieved...that was a huge rationalization. So, what does one have now? More corporate/lobbyist written legislation, same as when GOP was in control over government....and the real things that must be structurally changed are not happening.

If people were aware during the primaries there could have been much higher demands...

instead I see this as the entire left was hoodwinked with a lot of very nice sounding rhetoric.

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But the rhetoric is needed to get people interested.

Like I said there is a difference on unfulfilled campaign promises and lying. Campaigning against big pharma and then cutting a back room deal with them is lying and dishonest. Campaigning for a 'public option' and then not even fighting for it is lying. Criticizing your opponents regarding excise taxes and supporting it over another alternative is lying. Saying that you didn't run for president to protect 'fat cat bankers' and doing the exact opposite is lying.

Yes, I would have expected the same DLC/Hamilton Project/neo-liberal bullshit from a Hillary Clinton presidency but I did not expect it from Obama.

Was I naive? Sure, but what were my options? Was I wrong for actually believing what a candidate said?

I am done with political parties. I changed my voting registration back in November to independent. As for 'left/progressive' politics - it would be better to focus on issues rather than candidates. The idea of a 'better democrat' is just not realistic.

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blow back

I always suspected that when people realized Obama was the most incredible marketing campaign since Coca-Cola, they would be very pissed off.

Nothing like downing a bottle of High-fructose laden bubble syrup, complete with caustic chemicals on the promise it will make you feel one with the world and deliver a real warm fuzzy.

I think it was during the primaries when EP came into being. I think the site was online and active somewhere late March 2008. I think one of the reasons I got that "coding bug" to put the site together because the entire Dem field to me was a joke. There was no real candidate running who have the ability plus the policy positions to turn the country around. Even Kucinich, he has some things to me are just economic insanity. (although I usually would vote for him myself in primaries).

I wrote a few things, on policy positions, comparison contrast but I was absolutely not working on any campaigns this season. Very disappointed and additionally very disappointed from the 2006 results....you work your ass off for someone who turns around and votes the way some lobbyist wants them to on a song....you spend 6 months of your free time, a corporate lobbyist gives one cocktail party and a check. You are blown off, taken for granted and that lobbyist gets their entire "order" written up, introduced and voted yes on.

It's disgusting.

If there is a primary worth trying to get a better candidate in, I'll switch to that party so I can vote in it. Other than that, I'm not sure what any of it really means.

But yeah, that's why EP is non-partisan so we can get to the details instead of the rancor.

I think during the general, I voted for all sorts of 3rd parties who normally I would call the cops on if they came anywhere near my lawn! ;) kind of a protest vote thing but where I am is extreme crunchy granola land, no chance in hell of any of these actually winning.

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Robert you and I agree

Robert you and I agree but there are still a lot of people in denial. They really are expecting change.

I had to laugh on this one because I did the same thing. "I think during the general, I voted for all sorts of 3rd parties who normally I would call the cops on if they came anywhere near my lawn! ;) kind of a protest vote thing but where I am is extreme crunchy granola land, no chance in hell of any of these actually winning."

I once lived in the land of crunchy granola and Birkenstocks. It was always a surreal experience. Kind of like walking down University Ave in Berkeley could probably whisk me back to my 1960's days of protest.

I do wonder if the people with blinders are ever going to catch onto the game. Month after month the Fed come out with headlines such as "Employers cut more jobs than expected in December." They are always "surprised". I would say they are not surprised but are more about hoping things will change. Maybe soon the Feds will start to realize that $trillions of dollars is a lot of money.

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Were they talking golf?

According to phone logs Geithner spoke to Warren Buffett - a big investor in Goldman Sachs and Lloyd Blankfein the day of the AIG bailout.

Do you think they were planning a golf trip? Hell NO.

Geithner was getting wiring instructions for the $33 BILLION that want to Goldman Sachs!

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Geithner Countdown to Firing

Geithner is on a roll. He basically went on NPR and undermined the "Volcker rule" almost immediately. Now he's saying that Freddie/Fannie reforms cannot happen (legislatively) until 2011....uh, why, they are hemorrhaging money!

So, if Obama wants to get a clue here and actually get somewhere with his financial reforms.....well, it's becoming increasingly obvious Geithner has got to go.

Will he do it? It's all or nothing if they want to have any effect on real financial reform here....

right now it seems they are putting their big toe into the financial reform (real reform) water and testing the heat but to have blow back almost immediately, publicly from the Treas. Sec. most people following this want gone anyway and under the most intense scandal because of the NY Fed's lack of action/AIG payout....

well.....

It also looks tittering, just another hard blow from public outrage, that Bernanke is not going to get confirmed.

It's pretty obvious that the public outrage is on max high and if this government is going to do something, well, they had better jump off of the fence and do it...

I have no idea why they think they can continue to let the status quo continue and believe anything would change. But they are acting like a bunch of chickens with no balls. They should just do it, and rip it off like a nasty bandage off of a wound. If they did, it would change the entire mindset of Congress and public perceptions on what the gov. can really do ....and the reality that governments, not banks, are supposed to be running the nation.

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