About AIG bailout – NY Times is carrying a summary of the report from the TARP overseer about how the government screwed up with AIG.
The most interesting point is that because the government was already on the hook for $85 billion that would likely be wiped out by a bankruptcy (ala CIT), Goldman Sachs knew the Fed didn’t view an AIG bankruptcy as an option, which is why they demanded and got 100 cents on the $1 for their swap contracts. That $85 billion was given to AIG by Paulson while Bush was still running the show.
