Welfare program for Wall Street insiders

Posted by Ray on July 20, 2009 under Main | 2 Comments to Read

Clearly when you have Goldmanites design a bailout program for financial institutions not only will they give them money upfront, but they also build the bailout so firms can profit for years to come. How you might ask?

Well, look at AIG for example, They got bailed out, with $13B going to Goldman Sachs and now Morgan Stanley is going to get a piece and Earnest and young. According to Bloomberg, Earnest and Young could recieve up to $60 million in fees from AIG for advice when the previous cap was set at $40 million in 2008.

Morgan Stanley will receive a $4 million retainer fee and an additional $2.5 million per quarter for advising AIG. The firm also could receive $72 millions if AIG lists its American International Assurance division on the Hong Kong exchange next year. All-in-all not a bad pay day for the financial sector at the expense of American tax payers, who says failure doesn’t pay?

This is one of those things that should make people question what is going on with these bailouts and TARP. With the expected cost of TARP reaching, potentially, $23 trillion a few million or even billion here and there is nothing, but these firms are not risking anything and they are receiving a nice payday.

Goldman and Morgan Stanley were both doomed to collapse last year before their bailouts and approval to become commercial banks. This begs the question, should they be compensated at all for advising a government owned entity when they would not be in business if it wasn’t for the government, a.k.a the US taxpayer?

This whole bailout was for the complete benefit of the financial institutions and not for the American people. It was payback for all the money funneled into Washington through lobbyists and campaign contributions, period. The taxpayer will not benefit from these bailouts. For example, have you received a dividend check yet from the firms who paid the Treasury interest on their TARP funds? Nope, well at least I have not gotten my check, so stop telling us we will profit from this, we won’t. Our taxes will not go down nor will our Social Security benefits increase, instead the money will be left in a slush fund indefinitely.

The only ones profiting are the same assholes who are responsible for the global meltdown, but no one says a word. Obama loves the banks, they gave him $23 million last year which is more than Hillary received, and will do nothing to stop this insanity. Instead firms will just collect funds when needed and pay out those funds to other investment banks in the form of advisory fees. The circle jerk continues at our expense.

If you are not outraged then you are not paying attention to anything that is going on.

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Tags: AIG, bailout, Earnest and Young, Goldman Sachs, morgan stanley, TARP, Treasury

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