Defaulting banks - where will it stop?

[Jan Klimkowski]

Zero Hedge has an insider leak on the AIG/Fed manipulations, involving the usaal suspects - with Goldman Sachs in a leading role.

It's long, technical in parts, and important:

http://www.zerohedge.com/article/present...ub-50-cent

A couple of nuggets from the piece:

while Goldman bought all of its CDO protection from AIG exclusively, it definitely used a very broad seller base when it loaded up on the actual AIG protection. Therefore, Goldman's only, ONLY risk, was that of a complete systemic collapse and the repudiation of all contracts, CDS and otherwise. Which is why Goldman's various agents did everything they could to prevent that from happening, up to and including loading the Federal Reserve with trillions of toxic debt in the upcoming 12 months.

The fact that the Fed was willing to risk taxpayer capital with such reckless abandon, first in the form of accepting literally worthless reference securities from Soc Gen (as documented by BlackRock), and subsequently by bailing out Goldman at well over par (remember the money the firm made on its actual AIG counterparty-risk) protection, would have been sufficient to terminate Geithner's career in any self-respecting banana republic. Too bad America is no longer even that.