they r not giving it to the banks, this is money they owe to other institutions (such as banks) who bought insurance against their securities. the securities have gone sour and now AIG has got to pay up. The life of some of these companies that bought insurance depend on these payments.
You're assuming too much. Even in mainstream, there were plenty of editorials critisizing Congress pay & subsequent raises.
This is old news. They all knew this at the time the money was givin. This is slick Obama(the teleprompter kid) trying to show he cares how taxpayer money is spent. When in fact he spends his time trying to find new ways to collect the tax payers money.
The idea of the AIG is that not the government who helped them but they have helped the government by accepting the bailout money to prevent the whole economy from collapsing and therefore they think that they deserve the bonuses. In my opinion, it was a poor judgment of the chairman anyway under the current circumstances.
Bottom line is the Tax payer money is being used to make good on these bets. So who was monitoring AIG as it knew it could never make good on these policies?
Talking about the money alone, to spend $165 million more is nothing compare to $173 billion that you have already spent. In other words, if you can spend $173 billion, why not $165 million. But the outrage wasn't about the money but rather than the ethical value. "This isn't just a matter of dollars and cents. It's about our fundamental values," the President said.
The OP has it exactly correct. The bonuses are a raindrop in the ocean compared to the trillions that Aig will eventually cost. Aig was the counterparty on large amounts of CDS contracts for most mortgages in the past 5 years. Aig is the sword hanging over the financial system. If the public only knew that aig owes 50 to 100 trillion.
I agree, it's all a diversion to get the focus off the real issue. The fact that we the taxpayers are being forced to cover the losses of all the counterparties that purchased insurance from AIG is the REAL issue. I have heard very little on the news about the fact that GS, HSBC,DB,BAC all have shiity deals that were made whole by the bailout money given to AIG. This bullshit about AIG being too big to fail is just a cover to allow the govt to continue to bailout the banks/brokers who totally fucked up. THAT is the real issue. And as taxpaying citizens, there ain't a damn thing any of us can do about it.
Now there lies the real problem. The CDS market is estimated at 50T. If AIG goes down the entire monetary system goes down. I think this is actually quite funny, in a sad sad way of course. It's rather comical that a company could write insurance for that amount of cash when the entire company was worth something like 150B (whatever that number is). It's downright hilarious when you think about it. The sad part is that it's going to take you, me, my kids, and my grandkid's (they aren't even born yet) lifetimes to pay this disaster back. For fuck's sake, the US's obligations are 6x their annual GDP. No wonder fucking China is concerned the US can't pay its debts and here we are fussing over a 165M? It is the principle, not the money though. These jackasses don't deserve their 9 to 5 salary let alone the damn bonuses. What a fucking racket. "Banksters."
Ohhhh....and I forgot to mention. That chart is from two thousand fucking seven. Here we are 2 years and 9T later. Who knows what the multiple is now. 10? 12? 20?