NYT Wins Award for Misleading Headline for Article on G.A.O. Report on A.I.G. Bailout

That should have us all reassured. After all, we don't want our government cutting deals when they bail out huge financial institutions.

Actually, the story says pretty much the opposite. The story tells how the Government Accountability Office (G.A.O.) found that the New York Fed made little effort to try to force banks to make concessions after it took control of A.I.G.

The point is that A.I.G. was effectively bankrupt and unable to pay all of its debts. In such circumstances it would have been reasonable for the New York Fed to insist that the creditors, in this case large banks like Goldman Sachs, accept some losses. These banks should understand that they take risks when dealing with financial institutions that are in questionable financial shape and should suffer some loss when they make a bad bet. However the government bailout of A.I.G. ensured that they suffered no consequences from their mistake.

roosters don't penalize other roosters
written by frankenduf, November 01, 2011 9:14 AM

apparantly, they read paulson's lips: NO STRINGS ATTACHED

...
written by skeptonomist, November 01, 2011 9:28 AM

The headline is correct; the Fed didn't cut deals with bankers, it just gave them everything they wanted.

Another Success Story
written by James, November 01, 2011 3:33 PM

for Wall Street bankers' lobbying $$$

rewarding irresponsible behavior of greedy bankers is expected and almost required....while

helping the unemployed, past due home owners, elderly is called those bastards should have known better, should have taken better care of themselves (while WS bankers DIDN'T have to know better, there was no way for them to truly know the risks of CDO's despite their 6-figure compensation and PHd's.

Its a den of thieves
written by hotcitykitty, November 02, 2011 4:38 AM

After watching "inside job" yestetday it is my opinion that walllstreet is really the new jackal of society and...we the people are lunch.These types have long left truth,moral compass,care of humanity-animal veg. man behind.We r our only hope to save earth and ourselves.

It's even a little worse than this
written by paul, November 03, 2011 10:40 AM

Any of the banks who bought AIG paper on the secondary market, when it was already trading at a discount from face value, got to buy low and sell high at taxpayer expense.

NYT Wins Award for Misleading Headline for Article on G.A.O. Report on A.I.G. Bailout

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