Tim Geithner

By John Terrett in Americas on March 23rd, 2010
Photo from AFP
Less than twenty four hours after their Healthcare victory in the House of Representatives, the Obama administration’s on the road again – this time touting the importance of financial reform.
 
Treasury Secretary Tim Geithner told the conservative leaning think-tank the American Enterprise Institute he will not accept a bill that doesn't provide strong protection for consumers and constraints on risk-taking large institutions. Mr Geithner said:  

"At its core is this basic sense of deep injustice and that moral failing of the system - the political opposition to doing things that look like they're going to benefit banks even if they're necessary to save the system is what leads most governments to screw up most financial crises - I apologise for saying it that way."
 

By John Terrett in Americas on February 4th, 2010
File photo by AFP

American International Group is paying out another round of whopping bonuses to execs.

Not surprisingly, the move has led to anger on Capitol Hill, at street level here in the US and I'm sure wherever you are now.

American International Group is lavishing up to $100 million in bonuses to executives in the firm's financial products division - yes - that's the outfit that nearly brought the giant insurer to the brink of collapse at the height of the financial crisis in 2008. (Hey! Nice work if you can get it)

This latest round of payouts comes almost a year after bonuses worth $168 million went to the same department.

On the streets of Washington, DC taxpayers who helped prop up AIG on the basis it was "too big to fail" are angry:

By John Terrett in Americas on November 18th, 2009
Photo by AFP

At the height of the great financial collapse of 2008, insurance giant AIG could not come up with enough cash to reimburse the many companies and countries that had insured against a collapse in the US sub-prime housing market.

AIG was such a huge firm that foreign governments from Europe to the Middle East and Latin America were phoning the White House to plead with the Bush administration to stop AIG from going out of business, in case their own economies were ruined.

The US government answered the calls by bailing out the big insurance company - and paying off, in full, the companies that AIG insured. 

Now, twelve months on and $150bn dollars of federal cash later to help AIG, a new report says the US federal authorities were too swift to pay back in full the big Wall Street banks who were insured against a collapse in the housing market through AIG.

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