Connect with us

Hi, what are you looking for?

Jewish Business News


Goldman Sachs, JPMorgan, Had Plan For Private Bailout of AIG


Goldman Sachs CEO Lloyd Blankfein and JPMorgan head Jamie Dimon were putting together a plan to bail out AIG privately before the government stepped in, Bloomberg reports.  Maurice “Hank” Greenberg, who was the largest shareholder of AIG, filed a lawsuit for $25 billion relating to the government’s bailout in AIG, alleging that taking 80% of the company’s shares in exchange for an $85 billion loan violated the 5th Amendment that the government cannot seize private property without just compensation.

Please help us out :
Will you offer us a hand? Every gift, regardless of size, fuels our future.
Your critical contribution enables us to maintain our independence from shareholders or wealthy owners, allowing us to keep up reporting without bias. It means we can continue to make Jewish Business News available to everyone.
You can support us for as little as $1 via PayPal at
Thank you.

Thomas Baxter, general counsel of the New York Federal Reserve Bank, said that he heard that Blankfein and Dimon said AIG, “was another problem we were taking care of, ” and Baxter added, “I took careful not of that colloquy, and it led me to believe we had another issue in AIG, but it was being handled by the private sector.” Baxter testified in a trial over the terms of the AIG bailout.

The New York Fed hired JPMorgan’s then-counsel Davis Polk & Warell LLP, “to eventually take over the documentation of a deal that was originally going to be done by JPMorgan Chase.”

David Boies, the attorney for Greenberg’s Starr International, showed that AIG was charged a higher interest rate than many banks the government bailed out. The interest rate charged AIG was 14%, triple some other financial institutions paid. Scott Alvarez, the Fed’s general counsel, said that the terms of the government bailout of AIG was intended to help AIG stay in operation and not to create disruption over the wider market.

Boies asked Alvarez, “Could both of those objectives have been achieved if the interest rate paid by AIG was half of what is charged?”

“Possibly, ” Alvarez said.



You May Also Like

World News

In the 15th Nov 2015 edition of Israel’s good news, the highlights include:   ·         A new Israeli treatment brings hope to relapsed leukemia...


The Movie The Professional is what made Natalie Portman a Lolita.


After two decades without a rating system in Israel, at the end of 2012 an international tender for hotel rating was published.  Invited to place bids...

VC, Investments

You may not become a millionaire, but there is a lot to learn from George Soros.