Secret Banking Cabal Emerges From AIG Shadows, page 1

It is good to see that some of the thoughts coming from alternative sites like ATS are starting to show up in the mainstream media. People are waking up to the fact that these bankers stole trillions of dollars from the American people and the government was powerless to stop them.

The privately run Federal Reserve Bank conspired with the large banks around the world to make sure that they got paid for their risky investments gone bad and left the American people with the bill.

We’re talking about the Federal Reserve Bank of New York, whose role as the most influential part of the federal-reserve system -- apart from the matter of AIG’s bailout -- deserves further congressional scrutiny.

The New York Fed is in the hot seat for its decision in November 2008 to buy out, for about $30 billion, insurance contracts AIG sold on toxic debt securities to banks, including Goldman Sachs Group Inc., Merrill Lynch & Co., Societe Generale and Deutsche Bank AG, among others. That decision, critics say, amounted to a back-door bailout for the banks, which received 100 cents on the dollar for contracts that would have been worth far less had AIG been allowed to fail.

The hearing revealed some of the inner workings of the New York Fed and the outsized role it plays in banking. This insight is especially valuable given that the New York Fed is a quasi-governmental institution that isn’t subject to citizen intrusions such as freedom of information requests.

This impenetrability comes in handy since the bank is the preferred vehicle for many of the Fed’s bailout programs. It’s as though the New York Fed was a black-ops outfit for the nation’s central bank.

New York Fed staff and outside lawyers from Davis Polk & Wardell edited AIG communications to investors and intervened with the Securities and Exchange Commission to shield details about the buyout transactions. That the New York Fed, a quasi-governmental body, was able to push around the SEC, an executive-branch agency, deserves a congressional hearing all by itself.

when unelected and unaccountable agencies pick banking winners while trying to end-run Congress, even as taxpayers are forced to lend, spend and guarantee about $8 trillion to prop up the financial system, our collective blood should boil.

I know some people don't like Glenn Beck but he had a great show last night 1/28 showing all the people in the Obama administration that are directly connected to Goldman Sachs.
Knowing that, it is easy to see why the Geithner ordered AIG not to negotiate and to pay 100% on the dollar on their credit default contracts. I suggest that people watch the show. I will try to find a link.

www.bloomberg.com
(visit the link for the full news article)