AIG?
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publius
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PostPosted: Thu, Mar 19 2009, 10:28 pm EDT    Post subject: Re: AIG? Reply with quote

Brilliant idea!

Give MORE money to the same morons who drove the company into the toilet in the first place!

If I ran my company like these idiots did, I wouldn't last 2 weeks!

WHAT A RACKET!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
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joe the plumber
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PostPosted: Thu, Mar 19 2009, 10:30 pm EDT    Post subject: Re: AIG? Reply with quote

I know of a plan thats even better than retention bonuses.








It's called time in federal prison!
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PostPosted: Fri, Mar 20 2009, 8:51 am EDT    Post subject: Re: AIG? Reply with quote

I find it hard to fathom the mind set that would advocate jail time for the offense of agreeing to a completely legal contract and then fulfilling that contract.
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BonusesRUs
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PostPosted: Fri, Mar 20 2009, 9:06 am EDT    Post subject: Re: AIG? Reply with quote

It seems the Treasury Dept. and Sen. Dodd screwed up this one.

Of cause, AIG also screwed up BIG time itself to be in this situation.

The government needs to prevent the next AIG.
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toenailcake
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PostPosted: Sat, Mar 21 2009, 10:51 am EDT    Post subject: Re: AIG? Reply with quote

Guest wrote:
I find it hard to fathom the mind set that would advocate jail time for the offense of agreeing to a completely legal contract and then fulfilling that contract.


I find it hard to fathom that the very same mindset which got us into a mess in the first place can be defended in the wake of such a financial/moral debacle.
We, the taxpayers, OWN 80% of AIG. So, what we say......GOES.
The company is under new management and we make the rules. If you don't like it..............sue us!
Since when do you "deserve" something when you helped to contribute to a company's demise?
The corporatists make me laugh. All hail the Almighty corporation!!!
the execs screw the company into the ground, bail out with golden parachutes, then they fire thousands of people to make up the difference! The best is when they park their "company" offshore to avoid taxation. The rest of us have to chip in to make up for their "patriotism".
We're onto your game and we have been fleeced & bamboozled long enough. Just waving shiny objects in front of us won't work that well anymore.
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PostPosted: Sat, Mar 21 2009, 11:56 am EDT    Post subject: Re: AIG? (AIG paid $53M more in bonuses than thought) Reply with quote

This company is not as honest as I thought.

---
Official: AIG paid $53M more in bonuses than thought

NEW HAVEN, Conn. (AP) — Connecticut's attorney general says documents turned over to his office by American International Group Inc. shows the company paid out $218 million in bonuses, higher than the $165 million previously disclosed.

Attorney General Richard Blumenthal's office received the documents late Friday after issuing a subpoena.

Blumenthal says the documents show that 73 people received at least $1 million apiece, and five of those got bonuses of more than $4 million. The financially ailing insurance giant has been under fire for giving bonuses after receiving more than $182.5 billion in federal bailout money.

AIG spokesman Mark Herr declined to comment Saturday.

http://www.usatoday.com/money/industries/health/2009-03-21-aig-bonuses_N.htm
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PostPosted: Wed, Mar 25 2009, 8:31 am EDT    Post subject: Re: AIG? Reply with quote

Your superior logic is clearly right. We have no idea who the recipients of the bonuses are or what their role in the failure of the company was but they clearly don’t deserve a bonus for working without pay for a year to try to resolve the problems. Which by the way, were caused by AIG insuring against the failure of derivatives that Fannie May and Freddy Mac created under the magnificent leadership and protection of Franks and Dodd. It’s really strange that an insurance company would insure things backed by the full faith and credit of the US government. Maybe we should not only take away those bonuses but also their first born children to serve as an example for anyone else that might want to do such a nefarious deed. While we’re at it we can ignore the guys in congress and Obama as they demand that the real culprits in this tale be given the power to take over any company they feel is a problem of some sort or the other.

Wake up guys.
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PostPosted: Wed, Mar 25 2009, 4:14 pm EDT    Post subject: Re: AIG? Reply with quote

DEAR Mr. Liddy,

It is with deep regret that I submit my notice of resignation from A.I.G. Financial Products. I hope you take the time to read this entire letter. Before describing the details of my decision, I want to offer some context:

I am proud of everything I have done for the commodity and equity divisions of A.I.G.-F.P. I was in no way involved in — or responsible for — the credit default swap transactions that have hamstrung A.I.G. Nor were more than a handful of the 400 current employees of A.I.G.-F.P. Most of those responsible have left the company and have conspicuously escaped the public outrage.

After 12 months of hard work dismantling the company — during which A.I.G. reassured us many times we would be rewarded in March 2009 — we in the financial products unit have been betrayed by A.I.G. and are being unfairly persecuted by elected officials. In response to this, I will now leave the company and donate my entire post-tax retention payment to those suffering from the global economic downturn. My intent is to keep none of the money myself.

I take this action after 11 years of dedicated, honorable service to A.I.G. I can no longer effectively perform my duties in this dysfunctional environment, nor am I being paid to do so. Like you, I was asked to work for an annual salary of $1, and I agreed out of a sense of duty to the company and to the public officials who have come to its aid. Having now been let down by both, I can no longer justify spending 10, 12, 14 hours a day away from my family for the benefit of those who have let me down.

You and I have never met or spoken to each other, so I’d like to tell you about myself. I was raised by schoolteachers working multiple jobs in a world of closing steel mills. My hard work earned me acceptance to M.I.T., and the institute’s generous financial aid enabled me to attend. I had fulfilled my American dream.

I started at this company in 1998 as an equity trader, became the head of equity and commodity trading and, a couple of years before A.I.G.’s meltdown last September, was named the head of business development for commodities. Over this period the equity and commodity units were consistently profitable — in most years generating net profits of well over $100 million. Most recently, during the dismantling of A.I.G.-F.P., I was an integral player in the pending sale of its well-regarded commodity index business to UBS. As you know, business unit sales like this are crucial to A.I.G.’s effort to repay the American taxpayer.

The profitability of the businesses with which I was associated clearly supported my compensation. I never received any pay resulting from the credit default swaps that are now losing so much money. I did, however, like many others here, lose a significant portion of my life savings in the form of deferred compensation invested in the capital of A.I.G.-F.P. because of those losses. In this way I have personally suffered from this controversial activity — directly as well as indirectly with the rest of the taxpayers.

I have the utmost respect for the civic duty that you are now performing at A.I.G. You are as blameless for these credit default swap losses as I am. You answered your country’s call and you are taking a tremendous beating for it.

But you also are aware that most of the employees of your financial products unit had nothing to do with the large losses. And I am disappointed and frustrated over your lack of support for us. I and many others in the unit feel betrayed that you failed to stand up for us in the face of untrue and unfair accusations from certain members of Congress last Wednesday and from the press over our retention payments, and that you didn’t defend us against the baseless and reckless comments made by the attorneys general of New York and Connecticut.

My guess is that in October, when you learned of these retention contracts, you realized that the employees of the financial products unit needed some incentive to stay and that the contracts, being both ethical and useful, should be left to stand. That’s probably why A.I.G. management assured us on three occasions during that month that the company would “live up to its commitment” to honor the contract guarantees.

That may be why you decided to accelerate by three months more than a quarter of the amounts due under the contracts. That action signified to us your support, and was hardly something that one would do if he truly found the contracts “distasteful.”

That may also be why you authorized the balance of the payments on March 13.

At no time during the past six months that you have been leading A.I.G. did you ask us to revise, renegotiate or break these contracts — until several hours before your appearance last week before Congress.

I think your initial decision to honor the contracts was both ethical and financially astute, but it seems to have been politically unwise. It’s now apparent that you either misunderstood the agreements that you had made — tacit or otherwise — with the Federal Reserve, the Treasury, various members of Congress and Attorney General Andrew Cuomo of New York, or were not strong enough to withstand the shifting political winds.

You’ve now asked the current employees of A.I.G.-F.P. to repay these earnings. As you can imagine, there has been a tremendous amount of serious thought and heated discussion about how we should respond to this breach of trust.

As most of us have done nothing wrong, guilt is not a motivation to surrender our earnings. We have worked 12 long months under these contracts and now deserve to be paid as promised. None of us should be cheated of our payments any more than a plumber should be cheated after he has fixed the pipes but a careless electrician causes a fire that burns down the house.

Many of the employees have, in the past six months, turned down job offers from more stable employers, based on A.I.G.’s assurances that the contracts would be honored. They are now angry about having been misled by A.I.G.’s promises and are not inclined to return the money as a favor to you.

The only real motivation that anyone at A.I.G.-F.P. now has is fear. Mr. Cuomo has threatened to “name and shame,” and his counterpart in Connecticut, Richard Blumenthal, has made similar threats — even though attorneys general are supposed to stand for due process, to conduct trials in courts and not the press.

So what am I to do? There’s no easy answer. I know that because of hard work I have benefited more than most during the economic boom and have saved enough that my family is unlikely to suffer devastating losses during the current bust. Some might argue that members of my profession have been overpaid, and I wouldn’t disagree.

That is why I have decided to donate 100 percent of the effective after-tax proceeds of my retention payment directly to organizations that are helping people who are suffering from the global downturn. This is not a tax-deduction gimmick; I simply believe that I at least deserve to dictate how my earnings are spent, and do not want to see them disappear back into the obscurity of A.I.G.’s or the federal government’s budget. Our earnings have caused such a distraction for so many from the more pressing issues our country faces, and I would like to see my share of it benefit those truly in need.

On March 16 I received a payment from A.I.G. amounting to $742,006.40, after taxes. In light of the uncertainty over the ultimate taxation and legal status of this payment, the actual amount I donate may be less — in fact, it may end up being far less if the recent House bill raising the tax on the retention payments to 90 percent stands. Once all the money is donated, you will immediately receive a list of all recipients.

This choice is right for me. I wish others at A.I.G.-F.P. luck finding peace with their difficult decision, and only hope their judgment is not clouded by fear.

Mr. Liddy, I wish you success in your commitment to return the money extended by the American government, and luck with the continued unwinding of the company’s diverse businesses — especially those remaining credit default swaps. I’ll continue over the short term to help make sure no balls are dropped, but after what’s happened this past week I can’t remain much longer — there is too much bad blood. I’m not sure how you will greet my resignation, but at least Attorney General Blumenthal should be relieved that I’ll leave under my own power and will not need to be “shoved out the door.”

Sincerely,

Jake DeSantis
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PostPosted: Thu, Mar 26 2009, 8:25 am EDT    Post subject: Re: AIG? Reply with quote

Worked for $1, but guaranteed to receive millions of bonus?

I'll work for $1 as well.

A smart guy like him is better off working for another company.
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PostPosted: Thu, Mar 26 2009, 12:11 pm EDT    Post subject: Re: AIG? Reply with quote

What his letter failed to point out is that the bonus was guaranteed to equal his 2007 comp inclusive of salary and bonus. So while its fine to say they were doing some good work and not in the division losing money, it was still overreaching and greedy to expect 100% of your peak year comp when the company itself was losing billions. It's not like GM factory workers are able to say, "I exceeded my efficiency quota on the assembly line this year and wasn't part of the business that lost so much money, so I shouldn't have to take any cut" -- every part of that business is expected to take a cut. That's how it works in the real world. Almost no business insulates workers of one division from the overall performance of the rest of the business.
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PostPosted: Thu, Mar 26 2009, 5:54 pm EDT    Post subject: Re: AIG? Reply with quote

I can’t figure out what you guys are thinking. This was a contract entered into over a year ago between a company and an employee. If you think the company should have gone chapter 11 and renegotiated all of their contracts including those with their customers I could understand that but if you agree that the bailout was the right thing to do then the contracts should stand. What would you have Mr. DeSantis do?
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PostPosted: Thu, Mar 26 2009, 10:45 pm EDT    Post subject: Re: AIG? Reply with quote

Guest wrote:
I can’t figure out what you guys are thinking. This was a contract entered into over a year ago between a company and an employee. If you think the company should have gone chapter 11 and renegotiated all of their contracts including those with their customers I could understand that but if you agree that the bailout was the right thing to do then the contracts should stand. What would you have Mr. DeSantis do?


I don't think all this is mutually exclusive. At least some people here can simultaneously believe that the contracts should not be broken but that it was wrong of AIG and opportunist of some employees to enter into contracts that guaranteed peak year total comp when the facts were clear by that time that the peak level results were artificial (i.e. based on over sales of risky products and inflation of the profit that defined the bonuses by the under-reserving and re-insurance of the risky products) and that the subsequent year would be dramatically lower. In fact, there are laws that might construe those as invalid on the basis of fraud (as NY is pursuing now), but that’s ultimate for a jury to decide (and I highly doubt it will ever reach one). It is possible to condemn something without implicitly endorsing the subsequent action of trying to negate it.

Its also not clear that people "agree the bailout" was the right thing to do. But the sentiment is that in offering the bailout, there should have been a suspension of business-as-usual. The mistake, though, was in not expressly forcing a re-negotiation of those contracts (and allow those who refused to leave) prior to providing the bailout funds, as was done with the auto industry where some funds were held back and others were provided with claw-back provisions contingent on concessions from Labor to renegotiate contracts, etc. After all the Unions could claim the same thing – they have valid legal contracts with the auto industry that they are now being forced to accept breakage of as a precursor for taxpayer aid. Why should the white collar workers of AIG be protected in making million-plus salaries (Mr. DeSantis’ would be about $1.5M a year) while existing only through government aid while the five-figure blue collar workers of the auto industry, also with valid legal contracts, be forced to accept reductions to get a tiny fraction of aid in comparison?

Some could argue that AIG avoided a similar set of forced re-negotiation provisions primarily because its situation was so much worse whereas the Feds had more time to deal with the auto industry. So AIG execs are subsequently rewarded for creating an emergency and not admitting their condition until the last possible moment. And let’s not forget its not just about the salaries. AIG execs, including Mr. DeSantis, took not one but THREE extravagant executive retreats (I’ve been to a retreat myself at the Montage in Laguna Beach – the place one of theirs was held – and it is opulent and ridiculously expensive) after they were existing only through taxpayer subsidy. They also only started to curb private jet use when this bonus situation broke publically this month. So Mr. DeSantis can play the noble worker standing up for principle, but lavish compensation contract or not he was an active, direct participant in a culture that continued to totally disregard their status of government assistance and spend in excess, beyond that which they were contractually guaranteed, long after they were owned 80 percent by us taxpayers. His own letter makes it clear that he and other like him repeatedly sought assurance that they would receive the full amount of their excessive contracts along the way and thus ultimately felt entitled to no change in circumstance despite effectively being in receivership.

I think the contracts need to be honored. But I don’t think that makes Mr. DeSantis or his colleagues heroes. But for taxpayers, they wouldn’t have received a dime because the company would no longer exist. Instead, they continued to expect artificially inflated comp and limitless excessive perks on the public’s dime.
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PostPosted: Sun, Mar 29 2009, 10:51 pm EDT    Post subject: Re: AIG? Reply with quote

I don’t think we are a long way apart. It has nothing to do with them being heroic. It has to do with how our country is being run. I consulted for the debtors in possession of a large company that was going through Chapter 11 reorganization. One of many critical issues was the retention of qualified people. I recommended offering retention bonuses to key people in the organization. The bonuses were set up to be paid after the company emerged from Chapter 11. The bonuses were successful in retaining key personnel and protecting the investment of the debtors in possession. There was a painful forced debt to equity swap but they are now the owners of a successful company. The original stockholders took it in the shorts but that’s the meaning of risk and senior debt. I would hope for the same outcome with AIG. AIG screwed up big time but that has been compounded by the government standing in the way of their bankruptcy which would have allowed the problems to be (painfully) worked out in a way that would protect the rights of all parties to the extent possible. The way it is now everyone is afraid of the idiots in congress and there are no adults that can do the things necessary to right this sinking ship. The people that could help are leaving the company in large part because they have been demonized by the very politicians that have the original sins of Fanny and Freddy on the hands and then overrode the bankruptcy laws and voted to approve the bonuses. What should be economic and legal decisions are now political decisions. I have yet to see something the government runs well and this is no exception.
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SuperNews
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PostPosted: Mon, Mar 30 2009, 3:18 pm EDT    Post subject: Re: AIG? Reply with quote

Youtube latest AIG update from the oval office - its funny.

http://www.youtube.com/watch?v=zHCG5DXRC8o&feature=player_embedded
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publius
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PostPosted: Mon, Mar 30 2009, 10:30 pm EDT    Post subject: Re: AIG? Reply with quote

A. Nefarious Inc. sneers and guffaws at federal government.
B. Nefarious Inc.gets greedy and makes LOTS of stupid business decisions.
C. Nefarious Inc. begs federal government to give it LOTS of money.
D. Nefarious Inc. sneers and guffaws at federal government.

This is lesson #1 of Modern American Civics 101
If you want OUR money, then you play by OUR rules and WE set the terms. If you don't like it, than take your marbles and go home!!!
Too big to fail my tookas.
I worry for the poor shnook making 50k a year trying to get by.
The executives should be strung up like Mussolini.
Or, worse........made to get REAL jobs at 50k per year!!!!!!!!!
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PostPosted: Tue, Mar 31 2009, 8:05 am EDT    Post subject: Re: AIG? Reply with quote

If you are saying the government did a really stupid thing with the bailouts we may finally agree on something. Bankrupt is bankrupt.
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