Last March, I wrote this post about how investment banks such as Goldman Sachs were the ultimate recipients of the AIG bailout funds in the form of credit default swap (CDS) payouts.
Today, Senator Coburn asked Goldman Sachs CFO David Viniar how Goldman was able to negotiate a full payout on their AIG CDS, instead of taking, say, 50 cents on the dollar. The CFO responded by saying that there was no negotiation with government officials. "We received the term sheet, and we agreed to it."
He forgot to mention that Goldman executives not only agreed to the terms, but they promptly broke out into a chorus of "Celebration" by Kool and the Gang.
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