Tuesday, October 07, 2014

It Is News That the AIG Bailout Was a Way to Give Money to Goldman Sachs | Beat the Press

"Finally, Sorkin again makes the annoying assertion on the AIG bailout that, 'we got our money back — with more than $22 billion in profit.'

"This one deserves derision. Access to liquidity back in 2008-2009 carried an enormous premium. We gave $192 billion to AIG at a time when other companies were dying for cash. We would have made an enormous profit if we had invested government cash almost anywhere. For example, if we lent $192 billion to Dean Baker's Excellent Hedge Fund, which used it to invest in the S&P 500 and then split the gains with the government, the country would have pocketed over $100 billion from the deal. So would Dean Baker's Excellent Hedge Fund.

"Saying that the government made a profit on the bailout deals is irrelevant in any meaningful sense. The people who make this assertion are either showing their ignorance or being dishonest."

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