- Behind Insurer’s Crisis, Blind Eye to a Web of Risk on AIG. This one delves int the heart of the shadow banking system Nouriel Roubini keesp discussing. To me, the key here is that Goldman Sachs was intimately involved with both the financial wheelings and dealing of AIG and with crafting the government response to the crisis that ensued, but refuses to come clean about its level of involvement.
AIG Meltdown Graphic
- Agency’s ’04 Rule Let Banks Pile Up New Debt on the deliberate acts by the SEC and the Treasury to refuse to impose the slightest bit of regulation or oversight. Cox and Paulson have a lot to answer for. This article is the smoking gun as to why things got out of hand. Anyone who wants to know where the primary blame (there's plenty to go around) for the financial meltdown belongs can just read this article.
Narrated slideshow by Stephen Labaton.
- Pressured to Take On Risk, Fannie Hit a Tipping Point on Fannie Mae (FNM). The slant on the article is not so good, but it does make clear that FNM has had a series of bad managers and is having two different crises conflated into one. There is the Raines/Howard problems into 2004, with accounting malfeasance and internal errors brought about by a grow-at-all-costs attitude. Then there are the Daniel Mudd problems from 2004 - 2008, when the housing bubble finished its expansion and FNM was caught between too many masters - infestors, the mortage industry and Congress.
Graph of Fannie Mae's market share through the bubble.
These articles, particularly the first two, are must reads to get an idea of what the Bush administration allowed the financial sector to get away with since 2000 and especially since 2004 (when reading the articles, make careful note of events across the industry in that year, when it was not certain Bush would win reelection.). Hanky Panky Paulson has a lot to answer for, given that he lobbied for the deregulation when he represented Goldman Sachs and the oversaw the non-enforcement of what little regulation was left when he became Treasury Secretary.
As Bill Clinton said at the Democratic Convention, we are now seeing the effect of the Right getting to run things exactly as they wish - and look at the mess they've made.
PS - I adjusted the links to make the articles display in a single page format and have linked in some key support information. Be sure to check out the multimedia goodies in the left hand insert areas in all three articles. There's a lot of information buried in the supporting data.