Madoff stole billions of dollars, but AIG is taking money from all the taxpayers. - Gabe

AIG. There's not yet a Madoff bailout. - Paul Buchheit

excellent idea -- it *does*seem like madoff is a great candidate for some bailout money. - John Lilly

Madoff. He pleaded guilty to defrauding charities. AIG traders made bad bets, but so did more than half of Wall Street. - Misha Dynin

Misha: AIG made bad bets, then came to us for charity, and now they want to use that money to reward themselves for making such stupid bets. - Gabe

In my book, there is a difference between knowingly doing something illegal, and taking advantage of the system. AIG traders signed contracts with guaranteed bonuses, because they could. They collected the money--obviously undeserved--legally. They acted rationally, if not ethically. I don't blame the people who exploited the flaws in the system, but rather reserve loathing for those who were paid to protect the system and didn't do their job: SEC and politicians. - Misha Dynin

It was obvious to a lot of people that derivatives market is a time bomb. It was fairly obvious to me, and I have indirect exposure to financial industry. Here's a link from three years ago: http://dynin.blogspot.com/2006... It was obvious to Warren Buffett, who described the problem and predicted the crisis scenario in 2005 BRK annual report. Why wasn't there more regulation? Insurance industry is tightly regulated--why weren't credit default swaps, which are insurance in all but name? - Misha Dynin

$165mil in bonuses is 1/5000th of the total bailout cost. It's in the noise, not worth any attention. If it wasn't AIG who took advantage of the system, it would be somebody else. My beef is with people who knew the system is not robust, were in position to fix it, but didn't. - Misha Dynin

Misha, it sounds like you're saying that being unethical but legal is less loathsome than unethical and illegal. Being legal just means that you don't have to pay for your mistakes. That sounds pretty loathsome to me. - Gabe

I like the "Who's more loathsome?" theme. Can it be extended? - j1m

Misha, you should be disgusted with Buffett then. Berkshire was the largest shareholder of Moodys through all of their shenanigans, and it's clear he knew they were rating junk AAA. - Private Sanjeev

j1m, do you have people you think are more loathsome? - Gabe