That doesn't even put fear in anyone. These people are called out by the press and scolded by the freakin' President. Yet it keeps repeating itself. There is no doubt that when faced with a choice of greed or embarrassment, embarrassed always gets the silver. I think we need Bauer on this.
This time bomb was started long before AIG got into CDS trades, not that they are not jackasses. They really didn't have much choice other than not have entered the market at all.
LOL - who forced AIG at gunpoint to enter the market and write trilions of dollars worth of coverage that it didn't understand? AIGFP wasn't an old line unit, it just started in 1987 and was pretty much singlehandedly built up by Joseph Cassano (who had a great pedigree, I mean Drexel Burnham! you couldn't make that stuff up). It was a small unit with about 300 employees. Pretty hard fo them to wash their hands of it. It's not as hard to assign blame here as you are making it out to be.
Nobody understood the market, that was the problem. They were not the only ones in the CDS, you paid the market price for playing the game, see ABX. Frankly, the idiots at S&P and Moody's were much more at fault than these guys.
Again, I say so? All the more reason that they should not get a bonus. Actually, also a good reason to see if we can clawback bonuses in prior years if it is as you say. Good. Deny them bonuses too.
I wonder why fallout from the ratings agencies is miniscule, but reading about 10 cubed makes me think the anger over AIG Financial is more than justified.
No bonus would be there were it not for the bail out, performed or not. If you think you'd be better off working for another company, there's no stopping you. End of story.
This sounds good. Too bad they can't come up with some criminal charges and as a condition of probation they have to work without bonuses till they help us find the dead bodies and exhume them. From an interesting article by Robert Reich. ******** AIG's arguments are absurd on their face. Had AIG gone into chapter 11 bankruptcy or been liquidated, as it would have without government aid, no bonuses would ever be paid; indeed, AIG's executives would have long ago been on the street. And any mention of the word "talent" in the same sentence as "AIG" or "credit default swaps" would be laughable if it laughing weren't already so expensive. Apart from AIG's sophistry is a much larger point. This sordid story of government helplessness in the face of massive taxpayer commitments illustrates better than anything to date why the government should take over any institution that's "too big to fail" and which has cost taxpayers dearly. Such institutions are no longer within the capitalist system because they are no longer accountable to the market. So to whom should they be accountable? When taxpayers have put up, and essentially own, a large portion of their assets, AIG and other behemoths should be accountable to taxpayers. When our very own Secretary of the Treasury cannot make stick his decision that AIG's bonuses should not be paid, only one conclusion can be drawn: AIG is accountable to no one. Our democracy is seriously broken http://www.huffingtonpost.com/robert-reich/the-real-scandal-of-aig_b_175105.html
so why can't we pass legislation that says that the federal government will declare null and avoid any contractual obligation for wages above X amount (or bonuses or whatever) for employees of companies that were insolvent and bailed out by the federal government/fed reserve.
I can't believe you are agreeing with the lefties on this. If they got a contract that pays out the bonuses, I think they should pay it. If AIG didn't include clawbacks in there, then the employees have every right to it.
What's the point of keeping people employed if they will not work hard anymore? Take away the bonus and most employees will just DO their job and nothing more. So this year everyone at AIG will go to work with no real incentive to work other than base salary and job security. Sounds like a sinking ship no matter what the government does.
I think that if any company is suckling the taxpayer teat, the taxpayer's representatives should be able to control their business. Had there been no bailout, or had the bailout been 1/2 of its size, the employees that remained would be behind a whole bunch of other people trying to get a judge to award them some scraps at a Chapter 11 proceeding. Finally, a whole lot of those employees contractually obligated bonuses committed fraud to get us in this mess. Hang 'em high.
If these people were the ones selling the CDSs, then their commissions and/or bonuses are ill-earned. If they didn't properly communicate the risks the sales are fraudulent, and if they didn't know the risks then they shouldn't be the ones selling the products.
This story is a total sham. The bonuses are a distraction. A distraction intended to do several things: 1) Whip up populist sentiment to fuel additional redistributive tax policies 2) Deflect attention away from the failed policies of Obama and on to 'greedy' Wall Street managers 3) Deflect attention from the fact that over half of the AIG bailout cash went to Goldman and European banks You people need to realize that Obama's game is all about subterfuge. How else could someone with absolutely no accomplishments in life parade around like Julius Caesar and not get called out on it? Every story is intended to manage people's reaction. Every story is intended to mask more controversial actions. Every story is an attempt to manipulate. Every story is meant to deceive. This guy is so managed by his handlers that it's not even funny.
