Are you stupid or have you known this all along?

That's a question my former boss and mentor used to ask when you really screwed up. It was asked half in jest but the staff knew it often signaled the beginning of the end for someone's career at the company. This is the first of what I hope won't be too many semi-irregular posts rhetorically asking this beautifully simple question.  First up are Liddy, Geithner, Bernanke, Frank, and Dodd.



When the feds gave AIG $85 billion in return for an 80% stake in AIG, they must have performed due diligence. To not do so would be incompetent at best. As part of due diligence they would have discovered the AIG Bonus Contract that was effective in December of 2007. Lawyers looked at it. Finance guys quantified them. Bernanke, Paulson and Geithner were the ones who recommended that AIG be bailed out and presumably signed off along with Frank, Dodd and the administration on the terms. Those terms according to the NY Times include  " tight control over A.I.G. There are requirements that the A.I.G. board of directors be comprised of members satisfactory to the government trust and that there be corporate governance standards acceptable to this government trust." After several days of finger pointing Dodd fessed up to authoring the amendment that allowed for the bonuses to be paid and Geithner to "green lighting" the bonuses. Liddy was of course in it also since he probably delivered the bonuses himself. So they new it all along.