At Bloomberg (HT: RealClearMarkets.com):
paralyzes the political processes’ ability to deal with them
intelligently. I have no doubt that, by the time this saga ends,
we will all know what happened to every penny of that $165
million in bonuses and each have our opinion of the morality of
it.
I doubt seriously we will ever understand the morality of
the $173 billion payment that is the far more serious issue. For
instance, Goldman Sachs, which received about 8 percent of the
pile, or $13 billion, has claimed publicly that the money was,
to them, a matter of indifference, as Goldman had hedged itself
against a possible collapse of AIG — by making bets against
AIG.
This suggests that it was clear to at least one market
player, before the collapse, that AAA-rated AIG was behaving in
ways that might lead to its demise — which is to say that there
was really no responsible place to lay off these bets. (So why
bail out those who made them?)
It also suggests that it is a matter of indifference to
Goldman Sachs whether AIG lived or died, as either way it was
protected. (So why bail it out?)
