But as an ex Investment Banker, I was impressed with Eliot Spitzer's analysis of the Wall Street debacle on today's Fareed Zakaria GPS. Lemme tell you, this is Exactly what happened and you would be well served in hearing, or reading it yourself!
SPITZER: ....When AIG initially received $80 billion, a decision that was a consequence of a very brief meeting of the New York Fed, the president of the New York Fed, the secretary of the treasury, perhaps Chairman Bernanke, and arguably, some reports say, the chairman of Goldman Sachs, $80 billion, virtually all of it flowed out to counterparties, $12.9 billion to Goldman Sachs.
Why did that happen? What questions were asked? Why did we need to pay 100 cents on the dollar on those transactions if we had to pay anything?
What would have happened to the financial system had it not been paid?
These are the questions that should be pursued. Bonus is a real issue, it touches us viscerally, the real money, and the real structural issue is the dynamic between AIG and the counterparties.
ZAKARIA: Because those payments are in the tens of billions of dollars, the bonuses are a few hundred million.
SPITZER: The bonuses, we think, are $164 million, give or take, huge money, I mean, nobody should diminish that, but these counterparty payments, tens and tens of billions of dollars.
ZAKARIA: And it -- to your mind it seems as though that this taxpayer may have been recklessly and unwisely paid out?
SPITZER: Maybe the case could be made that it should have been paid. But at a moment in our nation's history, when everybody is being asked to bear a piece of the burden, everybody, people are being told, work four days a week, not five, sales taxes are going to go up, contracts are being broken and renegotiated for workers across America, our 401(k)s and our savings have been depleted by the recklessness of Wall Street.
For Goldman and the other counterparties not to be able to say, we can make do with only 50 cents on the dollar, 30 cents on the dollar, after we've already given Goldman a $25 billion cash infusion, they are sitting on vast amounts of cash on the sidelines -- which is their right, but they're going to invest it in due course based upon their judgment.
For them, on top of all of that, to get another $12.9 billion in the dark without questions after a meeting of this sort is fundamentally wrong. And that is the nature of the inquiry that should be raised.
To Zakaria, kudos for a brilliant and intelligent piece of journalism - to Spitzer, compliments for being truthful, unflinching and yet nuanced.
OK, back to the Sharks.