Article III, Section 3 or Just AIG

Anytime I hear that any government bailed out entity is acting in “the best interest of taxpayers” I smell a rat! When I hear AIG (NYSE: AIG) say that it wants to buy back “assets” from Maiden Lane II, I find myself wishing that the framers of the U.S. Constitution had anticipated the government declaring war on its own currency when Article III, Section 3 was drafted. When I find out that the New York Federal Reserve is actually not sure that it wants to take AIG’s offer of $15.7 billion in cash (yes, U.S. Dollars – THAT cash) in exchange for toxic assets which nearly cratered the company and the country just two years ago I lament for the absence of any public media capacity to actually tell the country what’s really happening.

Let’s review for a moment. The U.S. Treasury – that vaunted entity that is responsible for the financial assets of the United States – owns about 92% of AIG. For the record, that’s a controlling interest and, we, the people, allegedly are being served by the management thereof. The New York Federal Reserve, the Managing Member of Maiden II, together with the collateral agent, The Bank of New York Mellon, are actually the “owners” and “managers” of Maiden Lane II. You will recall, recently the Federal Reserve (a corporation having NO public accountability and having no interest in the taxpayers’ interests) authorized the purchase of approximately $600 billion in U.S. Treasury securities. Now I know this will come as a shock but this purchase explicitly violated the rules of independence set forth in the AIG bailout – specifically violating provisions of independence required under the Fed’s custodial role. By accepting AIG’s purchase of the Maiden Lane II assets, the Fed would receive an estimated $1.5 billion profit for selling securities for $0.50 on the dollar.


But, you’d have to be a real loser to spend this much time actually READING the evidence of the cover-up to know any of this. However, in the interest of demonstrating just how much a geek I am, I decided that there was a bigger rat behind the ludicrous statement being made by U.S. Treasury-owned AIG. So I went down the rabbit hole of the CUSIPs (the Committee on Uniform Security Identification Procedures) which are the records of the assets actually toxic enough to qualify for bailout but now so desirable to own that the U.S. Treasury has decided that holding them is MORE ATTRACTIVE THAN HOLDING U.S. CURRENCY! While I won’t bore you with all of the assets, I wanted you to see exactly the “quality assets” which are better than the U.S. dollar according to the U.S. Treasury and the Federal Reserve Bank of New York.

Mortgage Obligations originated by…

Countrywide Home Loans Servicing LP's

IndyMac Bank, F.S.B. - Chapter 7 bankruptcy

Newport Management Corporation

Wells Fargo Bank, N.A.

Deutsche Bank National Trust Company


Yes, you’re reading this correctly. Assets of failed, bailed out, and civilly indicted (soon to include the prospect of criminal charges) banks are officially “better” investments than cash. And this determination is made by the organization responsible for maintaining the quality of U.S. cash! I wish you could make stuff like this up but reality is far more tragic than fiction could ever imagine.

Now, if you’re sitting there thinking to yourself, “Certainly someone somewhere out there knows what they’re doing,” I wish I could provide you some solace. However, in a painful experience this week with one of North America’s most respected news entities, I found out how anemic fiscal literacy is in our media and how horrific their attention span is to outright fraud. So, for the record, let’s simplify it and see if you can use your forwarding capacity on your browser to make sure others you know find out the simple truth.

In the public announcement made by the U.S. Treasury (owner of AIG), the Treasury has said that its own money is less valuable than toxic mortgage securities. The New York Fed, actually having to reflect on the sales offer – the same Fed that bailed out the Treasury for QE2 (the politically correct term for certifying counterfeit currency as the sale was NOT backed by an independent buyer thereby defying the “willing buyer” requirement for an independent transaction) – seems to agree that holding toxic mortgages is better than holding the dollar. And, every major financial media outlet, in their pathetic pandering to the propaganda that led us down the primrose path to Maiden Lane, regurgitates the LIE that this is good for the American taxpayer and the U.S. government. Ah, for the good old days of clear cut treason when people sought to destroy the country with tired trinkets like muskets and cutlasses. Now, treason is death by a thousand paper cuts of unread securities agreements written to blind the public in plain sight.

For years I pointed out that the 2008 collapse was not a “housing market” crisis but the fully forecast collapse of housing market financials when houses were used as ATMs and real estate became the basis for reckless consumer credit. Well, now we’ve got it. We really have the 2008 crisis that didn’t happen then. In this wholesale robbery from the public and in the broad light of fraud, the New York Fed, the Treasury, and their puppet AIG, are now solidly collapsing the dollar. I guess the Utah legislature is prescient in their decision to move towards a state-minted legal tender gold and silver standard. Because, what’s in your wallet is the ghost of a system built in 1913 which has now fully failed.

While most of the time, I end my blog posts with a “happy ending” I can assure you that this one doesn’t end happy. It ends with a warning. When we construct the next economic system, accountability and transparency not only will require an informed and educated population but it will require people like you, having read this, and having independently checked the accuracy of what I’ve reported, taking the next step and forwarding this to everyone you know who has a dollar or who has ever used a dollar so that, “no one saw it coming” can’t be said this time.

So go ahead, take a challenge from a Virginian who had the courage to actually call for Liberty and hit the "send" button. If a tea tax got in the craw of colonies - let's see if you know treasonous behavior when you see it and then, let's see if you do something about it!