Who Got The AIG Bailout?
The press and the blogosphere are abuzz concerning reports that much of the AIG bailout money went to other banks and financial institutions. But should that really be a big surprise?
The fact is the bailout of AIG was never about bailing out AIG. It was to prevent a much bigger systemic problem. AIG was a counterparty on numerous credit default swaps. The failure of AIG as counterparty would have resulted in untold losses throughout the financial system. Whether or not the AIG bailout was the right thing, that was the real reason.
The question we have to ask is who is responsible for allowing AIG to get where they were.
