Tuesday, October 7, 2014

A.I.G. Casting Call

Sometimes I'm not paying attention to which section of the newspaper I've picked up. I buy the WSJ and the NYT every day but Sunday (no WSJ published on Sunday, anyway) and open the paper, separate the sections and plop them on the couch or table. I don't shuffle them, but I pick up any one section on whim. Sometimes I'm not always aware what section I've started to read.

Not paying attention was the case the other day when I picked up a NYT section and started to read: A.I.G. Trial Witnesses Will Be Central Cast From 2008 Crisis. It was a Tuesday paper.

Jesus, they're going to make a movie about this? Who does Tom Hanks get to play? I bet George Clooney gets a piece of this.

Well, of course that wasn't what the story was about. I was reading the NYT Business section, specifically the Deal B%k segment.

That's 'Deal Book,' but written as I typed it above. The Times is allowing it's editors and writers to embrace the social media age and use all kinds of symbols to communicate. This is no doubt a policy meant to retain staff. If any of our stuff is found 2,000 years from now someone is going to think we went back to Egyptian hieroglyphics. No matter.

A teaser except said: 'New scrutiny for a bailout at the peak of the financial disaster."

Shown were two pictures. One was of Scott Alvarez, the Federal Reserve General Counsel, and the other was of Maurice R. Greenberg, the former A.I.G. executive. Mr. Greenberg's name is often affectionately sometimes written as Maurice (Hank) Greenberg.

This is an obvious clue to Mr. Greenberg's age, because he's just about the only one prowling the corridors of power these days who probably saw Hank Greenberg bat for the Detroit Tigers at Yankee Stadium against the Yankees, or saw Hank in Detroit, or saw him in Chicago against the White Sox. Mr. Greenberg, the ballplayer has long passed on (1986). Mr. Greenberg, the former A.I.G. executive is still alive at 89, a living testament that you can live a very long life before asking if you can take it with you. The only business mogul on earth that I'm aware that is another octogenarian is Mr. Rupert Murdoch, who is six years junior to 'Hank'.

Behind Mr. Greenberg, slightly out of focus, is Daivd Boies, the attorney for Mr. Greenberg. Since the trial is in a Washington D.C. Federal Court of Claims you've got to marvel at how much money must be at stake if 'Hank' is bringing Boies and the team in to Washington to stay at Washington D.C. hotels and dine on either deli sandwiches and gourmet hamburgers, or explore Georgetown, or Tidal Basin restaurants, not to mention a possible foray to a strip club or two tucked away in a secret Washington quadrant. Or, do all of that, because they're going to be here a while. Hank's obviously got money.

David Bois of course can't come cheap. He represented the United States its anti-trust suit again Microsoft. He tried to win the 2000 presidential election for Al Gore before the United States Supreme Court.

Since the paper I was reading was from Tuesday September 30, it was reporting on the opening proceedings of the trial from Monday.

The trial is basically about Mr. Greenberg's argument that the bailout A.I.G. received in 2008 from the government in fact shortchanged the A.I.G. shareholders. They didn't get their value. He is seeking a $40 billion dollar settlement. (At this point, it's always billions.)

The Justice Department lawyer, Kenneth M. Dintzer, outlined that the company got a $182 billion lifeline, which allowed the company to reap a $22 billion profit. "It's like they've said thanks for the lifeboats, but they're just not comfortable enough."

This is great. This trial has got to be on television, no? No.

Granted, sex and money are two great preoccupations, but this trial about 2008 money is water under the bridge to some people. As good as Mr. Dinzter's language is, it can't compare to the interest the nation had in the Anita Hill/Clarence Thomas judiciary committee hearings about Mr. Thomas's nomination to be a Supreme Court Justice, when a United States Senator from Utah, Mr. Orrin Hatch, seemed to keep repeating "Long Dong Silver."

Now that was worth watching. Here we have what the business guys and writers are trying to convince us is another trial of-the-century. After all, as the WSJ photo shows us, standing left to right, with the first two in the lotus-leaf posture with their hands, are former secretary of the treasury Henry Paulson, former Chairman of the Federal Reserve Bank, Ben S. Bernanke, and  former New York Reserve Bank President Timothy Geithner (later secretary of the treasury). The financial Dream Team of witnesses. You know at some point someone is going to have to try and explain Collateralized Debt Obligations (CDOs).

This is not the three Wise Men who are going to tell us why they brought the gifts they did to that family stuck in a Bethlehem stable. Okay, Ben there has a beard, but the other two? Not charismatic looking enough to give up Ellen.

But, everyone has to make a living, and everyone sometimes needs to talk and to write, even this posting. Today, the NYT in one of its columns, Andrew Ross Sorkin comments that the trial is trying to spin "a ludicrous tale in open court in Washington that the bailout of the insurer [A.I.G.] was unfair to its investors."

Mr. Sorkin adds comments from a NYT Op-Ed writer, Noam Scheiber, who he admits he has often read with admiration, "as asinine as the Starr suit [parent company of A.I.G.] may be in legal terms, it may end up serving a constructive purpose." Why is this? "Ever since the details of the A.I.G. rescue entered in to the popular consciousness, everyone from the members of Congress to financial commentators to Occupy Wall Street protesters and Tea Party activists have fulminated against the 'backdoor bailout' of Goldman et al. By litigating the issue the Starr trial may finally heal this festering wound."

Thank goodness it's a non-jury case and it's not on TV.

"Constructive purposes" and CDOs can never beat Long Dong Silver.


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