For the millionth time, why does Goldman Sachs get a free pass from Congress and the White House? The American taxpayer saved them from ruin so there is no reason why Goldman Sachs should not be under the same TARP pay conditions as fellow losers Citi and Bank of America. Despite their best efforts to say otherwise, the company could have been in serious financial trouble last year without the government passing billions to Goldman via AIG.
If AIG had collapsed, it would have made it difficult for Goldman to liquidate its trading positions with AIG, even at discounts, the report said.
It also would have put pressure on other counterparties that "might have made it difficult for Goldman Sachs to collect on the credit protection it had purchased against an AIG default." Finally, the report said, an AIG default would have forced Goldman Sachs to bear the risk of declines in the value of billions of dollars in collateralized debt obligations.
