January 26

Goldman Sachs Drove Most Costly AIG Bargain, Document Shows (Bloomberg)
Goldman Sachs Group Inc. was the most aggressive bank counterparty to American International Group Inc. before its bailout, demanding more collateral while assigning lower values to real estate assets backed by the insurer, documents obtained by lawmakers show.

The Second Clinton? (BaselineScenario)
Does last week’s Volcker-fest mean that the Obama administration wants to get tough on Wall Street, or is it just a political show?

Under fire, Wall St. puts money to work (Globe and Mail)
Roosevelt Institute Fellow Thomas Ferguson is quoted on just how well-represented the banking lobby is in Washington.

Obama to Seek Freeze on Some Spending to Trim Deficits (NYT)
President Obama will call for a three-year freeze in spending on many domestic programs, and for increases no greater than inflation after that. Initiative is intended to signal his seriousness about cutting the budget deficit, administration officials said Monday.

Fed Weighs Interest on Reserves as New Benchmark Rate (Bloomberg)
Federal Reserve policy makers are considering adopting a new benchmark interest rate to replace the one they’ve used for the last two decades.

U.S. Opens Probe into AIG’s Payout to Partners (WSJ)
A U.S. government investigator is opening a probe into disclosures made as part of the government’s rescue of American International Group Inc. when the company’s trading partners were paid billions in November 2008.

Chief of Staff Draws Fire From Left as Obama Falters (WSJ)
President Barack Obama’s liberal backers have a long list of grievances. The Guantanamo Bay prison is still open. Health care
hasn’t been transformed. And Wall Street banks are still paying huge bonuses.

Is There An Overlooked Reason for Fed Secrecy on AIG? (NakedCapitalism)
Are those pouring through various AIG-related disclosures missing key points or snookered into interpretations that may be unduly flattering to various banksters?