A.I.G., The Wrong Guys Taking The Fall
It appears that the wrong execs at A.I.G. maybe taking the fall for the thieves who destroyed the company and in effect the rest of the global economy.
This morning an Email letter of resignation was printed in the New York Times from Jake DeSantis, an executive vice president of A.I.G.'s financial products unit to CEO, Edward M. Liddy. Read on for full text as it appears in the Times:
DEAR Mr. Liddy,
It is with deep regret that I submit my notice of resignation from A.I.G. Financial Products. I hope you take the time to read this entire letter. Before describing the details of my decision, I want to offer some context:
I am proud of everything I have done for the commodity and equity divisions of A.I.G.-F.P. I was in no way involved in — or responsible for — the credit default swap transactions that have hamstrung A.I.G. Nor were more than a handful of the 400 current employees of A.I.G.-F.P. Most of those responsible have left the company and have conspicuously escaped the public outrage.
After 12 months of hard work dismantling the company — during which A.I.G. reassured us many times we would be rewarded in March 2009 — we in the financial products unit have been betrayed by A.I.G. and are being unfairly persecuted by elected officials. In response to this, I will now leave the company and donate my entire post-tax retention payment to those suffering from the global economic downturn. My intent is to keep none of the money myself.
I take this action after 11 years of dedicated, honorable service to A.I.G. I can no longer effectively perform my duties in this dysfunctional environment, nor am I being paid to do so. Like you, I was asked to work for an annual salary of $1, and I agreed out of a sense of duty to the company and to the public officials who have come to its aid. Having now been let down by both, I can no longer justify spending 10, 12, 14 hours a day away from my family for the benefit of those who have let me down.
You and I have never met or spoken to each other, so I’d like to tell you about myself. I was raised by schoolteachers working multiple jobs in a world of closing steel mills. My hard work earned me
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Comments [18]
mystic forgive me but I have
mystic forgive me but I have to comeback and say, he still didn't loose much if he can quit his job and still survive as though he were working. This guy is trying to look innocent. IMHO only.
Smile...life is good!!!
$742,006.40, after
$742,006.40, after taxes:!:
Waaaaa....!
I feel so sorry for him. NOT! That is more money than I made before taxes over the past 17 years. Oh, weren't you so civic minded, working for $1. Knowing you were going to have $742,006.40, after taxes in your pocket in a few months.
I'm sure this was meant to get to the media.
What in my comment above
What in my comment above triggered got Spammie's attention?
I can't understand why people
I can't understand why people are incapable of feeling empathy to someone that makes more money than them. Who cares, we all choose our vocations. I actively decided that my time on earth was more valuable to me than a large salary. Now I wish I had large sums of money in the bank, but I made that choice. This guy has finally given up, or realized that working in a place like AIG is a morally dubious situation. So he is choosing to leave. It is nice to see people decide they don't want to be associated with such morally questionable actions like those that harmed our economy. Everyone involved in this financial mess is a person, even those that got left holding the bag at AIG, after the other slicksters abandoned ship sooner. Uncovering the truth may never happen but can't our leadership grow up and quite acting like a group of pissed off grade schoolers on the playground after lunch. We are all adults, and we all knew where removing post depression regulation would take us.... Even if we chose not to pay attention to the leadership we elected! All we can do now is become active in our government and stop being apathetic about what happens in Washington.
Okay, I tried my level best
Okay, I tried my level best to stay out of this topic, mainly because of all the hysteria surrounding it. But, the hysteria is not going away, and in fact it seems to be getting a whole lot worse.
For those who do not know what a Credit Default Swap is, here's a simplified scenario:
Party A buys a business, and finances the purchase through Banker A. I waltz into AIG, and tell them I believe you will default on the loan. They look at Party A's credit, financial statements, etc, and say they believe Party A will repay the loan. I purchase "insurance," betting I'm right, from AIG. Two years later, Party A runs into trouble and defaults on the loan. I get millions of dollars for the few thousand I paid to AIG. Neither I nor AIG have any interest in Party A or Banker A. We're making a side bet on your success or failure. For a $200k bet in 2006, I made $10 million off the failure of Party A.
The people who set this whole casino up left AIG last year. The people who remained are not the ones responsible for the mess. They are, or were until last week, the ones trying to figure out how to unwind the whole mess and fix it, so that we the taxpayers, the ones with the torches and pitch forks, could get our money back.
But, AIG wasn't the only one at fault here. Hedge fund managers and speculators played a huge roll in creating the massive imbalance with regards to the CDS's. They made money off them only if they won the bets, so they did everything they could to trigger defaults. Congress, including all but two of last year's presidential candidates, knew all about this, and did nothing. Both the last president and this one still have yet to do anything, as is the case for the last Congress and this one.
Instead, the people who made the most off of the casino style bets are pointing the fingers at the very people trying to figure the whole mess out and fix it so that this can't happen again. Most notably shouting at the mob to whip them into a frenzy are our elected officials, the ones heavily invested in CDS's.
As a result, no one wants anything to do with the mess, most obviously those who have been trying to fix it but now are the targets. Their lives, as well as the lives of their families, are in danger, thanks to a few political hacks seeking to exploit a major misperception as to who is at fault in order to use the issue to distract from their own involvement in the take down of the United States economy.
Because of this mob mentality, the problem will never get resolved, and it is now likely AIG will not be able to repay the taxpayers.
Have we learned nothing from our own history? How many priests and ministers have vocally opposed our rights, even sought to make us criminals for who we love, have turned out to be every bit as gay as the rest of us? How many crooked politicians have shouted about morality and justice in the last few years, only to find themselves under indictment for committing immoral and illegal acts themselves?
I have learned, mostly from hard lessons, to be very suspicious of those who are all too willing to turn others into scapegoats, and to whip others up into a frenzy against those scapegoats. Those who speak out the loudest, who use a relative non-issue to distract the masses, are most likely major players in the very thing they are speaking out against.
We should, in particular, look at those politicians and other government officials who are claiming to be "outraged," claiming they didn't see this coming until very recently, and especially those demanding the names of those who got the bonuses. Either they knew all about this last October, when the information about these bonuses was first released, and they're lying to us, or they are the most incompetent elected and appointed officials ever, and should be removed from the offices they hold.
BTW, Obama got over $100,000 in campaign contributions from AIG executives, twice what McCain and Clinton got (individually). Dodd got over $200,000 since 1998. More than a few of those whipping the mob into a murderous frenzy got a piece of the AIG pie. I don't see any of them giving one penny back.
So, my question is this, who is trying to distract us from what by making those trying to figure this whole mess out into scapegoats, thereby hindering any progress?
Thanks mystic..
Thanks mystic..
Smile...life is good!!!
Just FYI, from the letter: "I
Just FYI, from the letter:
"I did, however, like many others here, lose a significant portion of my life savings in the form of deferred compensation invested in the capital of A.I.G.-F.P. because of those losses."
If he can quit his job and
If he can quit his job and still live as comfortable as he is now due to savings, he was overpaid. Obviously he didn't invest to much in AIG.
Smile...life is good!!!
This all comes back, yet
This all comes back, yet again, to "The Fed/The Federal Reserve."
http://www.velvetparkmedia.com/2009/03/16/bank-of-bernanke-when-all-else...
Bernanke's "interview" had multiple moments of contradictions/say what?? He said, and we've been told, "The Fed" is responsible to oversee the financial markets/banks, and that "The Fed" could have done a better job. What exactly were they DOING all these years? Hmmm.
I read this article a couple of days ago:
http://news.yahoo.com/s/politico/20090324/pl_politico/20416
"Bernanke also said the Fed knew about the bonuses last fall..."
Oh, ok, but "The Fed" (which doesn't answer to the President or Congress, or apparently inform them of anything...WHO DO THEY ANSWER TO AND INFORM?) and "our" government are soooo taken by surprise by everything that's happened "suddenly" and how we must pump out billions & trillions FOR OUR OWN GOOD now ("we're all in this together") because of this unexpected "crisis" that no one could have predicted.
Riiiiiiiiiiiiiiiiiiiiiiiiiiiight.
LIAR(
LIAR(
PANTS ON FIRE
Why do I not feel empathy and
Why do I not feel empathy and compassion for this individual? Maybe because I've lost my savings and am losing my house. Let's see 742K in a bonus (not a salary) versus a place to live...hmmm.
If this guy agreed to take $1 in compensation because he was promised a 742K bonus, he was making a manipulative political move. He gets a no pass on the "political winds" comment. Couldn't he anticipate the implications of taking the bonus in light of the bigger picture? He's presumably a smart man, couldn't he anticipate that a job-losing, house-losing, IRA losing public would be outraged to see their tax dollars going in a lump sum into his pocket? I wonder how many tax payers have lost the equivalent of 742K during this financial meltdown.
The "I didn't do it, he did" thing doesn't pass the sniff test. I couldn't work for Monsanto making seed bags without the consciousness of what goes in them and how it poisons food supplies and the environment.
Even if he didn't make this mess, his company did and his stock share compensation benefited him directly. If this resignation included a sincere public apology on behalf of his company and industry, I'd have a little more empathy.
I got down to the paragraph
I got down to the paragraph where he started telling about himself and stopped....Present day reality: A guy I went to high school with (still know him by way of old timers thinking they're rock stars) that has been and continues to be in the "buying mortgage paper" from one entity and selling them to another. Anyway.....he just bought a new plane - a bigger and better plane that he now has to get licensed for. I know this because he emailed another high school executive buddy (that is being laid off) and informed him of his new purchase.....I was raised by school teacher parents too, but I have had and continue to have the scruples I gained from that upbringing.....I do not and will not feel sorry for anyone connected with companies making money from and off of other people.....Come on now, you going to believe that a guy can live in NY on $1 a year?!?!? THEY ARE STILL MAKING MONEY OFF OF US - IT HASN'T STOPPED!
Screw 'em all,
Tex
Twitter Time @kdhales
True. I'm not in NY now, so I
True. I'm not in NY now, so I don't get as much local press on him. But thanks for perspective. Yes, Spitzer was obsessively methodical, exactly what you need in an Attorney General.
"And the gov is only now
"And the gov is only now trying to figure out how to create the laws and regulations that would make those financial transgressions illegal in the future."
Precisely. We should only be looking at the past for lessons about the future. Let law enforcement figure out what was or wasn't legal--it's too complex for the public to figure out, and the energy wasted is misguided. It's all about where we go from here.
Cuomo, is a bit of a grand
Cuomo, is a bit of a grand stander himself and somewhat responsible for the circus like behaviour, instigating the media and the public. I think Spitzer was much more measured and knowledgeable.
tweet tweet @gracemoon
i believe the people who
i believe the people who created theses CDO's that have become known as the "toxic assets" -- were created years ago. These CDO's were being sold by AIG from at least 2001 up through 08, so this guy is saying that the execs and sales people responsible for the toxic assets have already left the company -- before the market crashed in September.
the way to identitify them would be to find out who worked for the Financial Products division of AIG during the housing Bubble. the bubble had burst by the summer of 07, it took a full year for the shit to hit the fan and affect the over all economy.
They left the company before AIG was bailed out by the the government. the unfortunate situation is that what they did wasn't against the law, so there would be no recourse to go after them.
the shame is that that we, the public, are only catching up to the transgressions way after the damage has been done.
And the gov is only now trying to figure out how to create the laws and regulations that would make those financial transgressions illegal in the future.
tweet tweet @gracemoon
This is precisely why
This is precisely why investigations like this are best left to law enforcement officials like Attorney General Cuomo (and Spitzer who previously removed the AIG CEO) rather than those appalling circus-like congressional hearings that have done nothing but whip up angry lynch mobs.
"Well, then, who ARE those
"Well, then, who ARE those responsible and who have conspicuously escaped outrage?"
Exactly, and how/why were they able to escape public outrage?
"Fight Prime Time. Read a Book"
"Most of those responsible
"Most of those responsible have left the company and have conspicuously escaped the public outrage."
Well, then, who ARE those responsible and who have conspicuously escaped outrage?
Still searching for the right brainy quote.