Goldman Sachs Took Biggest Loan From Undisclosed 2008 Fed Crisis Program, but don't worry about their bonuses, they're fine

[Deepsepia]

Not surprising that this barely made the news: its redistribution of wealth in action. When Goldman Sachs was insolvent, they were funded by the Federal Reserve -- that's your creditworthiness-- in secret. When they returned to profitability, they paid themselves massive bonuses. There's your "reverse Robin Hood" at work . . . call it "The Sheriff of Nottingham Society"

Bloomberg (6 July 2011)

Goldman Sachs & Co., a unit of the most profitable bank in Wall Street history, took $15 billion from the U.S. Federal Reserve on Dec. 9, 2008, the biggest single loan from a lending program whose details have been secret until today.

The program, which peaked at $80 billion in loans outstanding, was known as the Fed’s single-tranche open-market operations, or ST OMO. It made 28-day loans to units of 19 banks between March 7, 2008, and Dec. 30, 2008. Bloomberg reported on ST OMO in May, after the Fed released incomplete records on the program. In response to a subsequent Freedom of Information Act request for details, the central bank disclosed borrower names, amounts borrowed and interest rates.

ST OMO is the last known Fed crisis lending program to have its details made public. The central bank resisted previous FOIA requests on emergency lending for more than two years, disclosing details in March of its oldest loan facility, the discount window, only after the U.S. Supreme Court ruled it had to. When Congress mandated the December 2010 release of data on special initiatives the Fed created in its unprecedented $3.5 trillion response to the 2007-2009 collapse in credit markets, ST OMO -- an expansion of a longstanding program -- wasn’t included.

full story at: http://www.bloomberg.com/news/2011-0...d-program.html

But "that was then"

As for today:

Besides chest-thumping fourth-quarter earnings, Goldman Sachs also announced its bonus pool on Thursday. At $16.2 billion, the total is 20 percent lower than the firm's 2007 level but still amounts to an average of just under $500,000 per employee.

http://www.csmonitor.com/Business/20...an-Sachs-bonus

There's a certain fitting irony to the symmetry: The taxpayers commit $15 billion in loans to keep Goldman Sachs solvent, and when all is better, Goldman Sachs pays themselves that amount (plus a billion or so more, because why be stingy with the best and brightest) in bonuses.

[Southern Belle]

AIG did basically the same thing. We bailed them out and they partied to celebrate at our expense.

[FBD]

Which goes back to the original point, being in bed with legislators opens these options to you.

The bailouts should not have happened in the first place.