Remember that in the past I’ve told you that Goldman Sachs is the devil of Wall Street, well here more proof. Corruption at its finest. Papers and other blogs have been filled with efforts of the NY Fed and Goldman Sachs to hide the details of the criminal conspiracy of the AIG bailout. Looks like Treasury Secretary Geithner has a golden parachute waiting for him at Goldman Sachs as payoff for his bailout of AIG. One of the chief recipients of this payout was Goldman who got $13 billion, roughly equivalent to its bonus pool for the first 9 months of 2009.

You see the bailout was engineered by the New York Fed while Geithner headed it, to buy out about $30 billion in credit default swaps that AIG sold on toxic debt securities. The New York Fed isn’t subject to citizen intrusions such as freedom of information requests, unlike the Federal Reserve. This impenetrability comes in handy since the bank is the preferred vehicle for many of the Fed’s bailout programs. It’s as though the New York Fed was a black-ops outfit for the nation’s central bank.

Even after the GM autoworkers, bondholders and vendors all received a government-enforced discount (talk about gov’t intrusion), Geithner had the audacity to claim the “sanctity of contracts” in the dealings with these companies like AIG. $170 billion of federal funds went to AIG and the banks feeding at its trough. A little side note, the Center on Budget and Policy Priorities found that state governments face a collective $168 billion budget shortfall for fiscal 2010. If the money used to bail out AIG and the banks had been used to bail out the states instead, the states would not be facing insolvency today.