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Tuesday, May 05, 2009

Fascism Update: NY FED Chief Makes Two Million Dollar Score On Goldman Sachs

People who look at Fascist and other economies of that type have a hard time telling whether corporate interests and insiders have taken over the state or the other way around. Anyway, the recent revolving door between Goldman Sachs and government and quasi governmental agencies is a perfect example.

Here we have the NY Fed chief not only keeping his Goldman Sachs position after Goldman became a bank but using likely inside knowledge to double down on his investment.

"The New York Fed asked for a waiver, which, after about 2½ months, the Fed granted. While it was weighing the request, Mr. Friedman bought 37,300 more Goldman shares in December. They've since risen $1.7 million in value.

Mr. Friedman also was overseeing the search for a new president of the New York Fed, an officer who has a critical role in setting monetary policy at the Federal Reserve. The choice was a former Goldman executive."

Remember, the exact actions of the FED such as what bad assets it may have bought or guaranteed from Goldman or any of it's counterparties are kept secret.

Goldman was one of nine big banks the Treasury aided with capital injections in early October. The prior month, the government decided, partly at the urging of New York Fed officials, to bail out insurer American International Group Inc. The initial $85 billion provided to AIG enabled it to pay a portion of $8.1 billion it owed to Goldman, stemming from past trading agreements. By the end of the year, Goldman had gotten all of the $8.1 billion as AIG received more government aid.

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