Back in the fall of 2008 when Paulson was pumping sunshine up our collective rectum we were told to pony up 781 billion dollars to get our banking in order. In those several purchases of the FED was AIG. The FED was initally paid $85 billion dollars. Later they purchased almost 80% of AIG, not knowing what the real value was because the 'derivitive' problem was about to begin its nuclear chain reaction. They bought the 80% worth about $150 billion at that time, all the while telling the taxpayers that moneyu would be recouped. Now today they tried to sell over $3 billion of AIG bonds and the sale did not happen....they only sold 1.89 billion or about 1%,....they could not 'unwind' their position,(sell their position) to recoup the taxpayers money. Now the FED has about $150 billion minus $1.89 billion worth of AIG bonds which they cannot sell.....because those derivitives were worth NOTHING and today they are worth NOTHING.
This will do wonders for sticking to their crappy game plan of stopping QE2,,,,,,,can QE 3 be far behind. Now they have spent 180 billion of AIG Bonds which will never be marketable. It is a nice statement of how well the ben bernank understands the problem and how efficacious his offered solutions are. We are in for the dollar printing to infinity. Sorry folks, but in the infamous words of Gecko in Wall Street Two, 'You guys are all,......pretty much......f.....d." (sorry for the implied expetive, but is seemed most appropo to this particular discussion.