It's the Derivatives, Stupid! Why Fannie, Freddie and AIG All Had to be Bailed Out

Has it all become a giant Ponzi scheme, with the U.S. taxpayers on the bottom?

The Fed is buying an insurance company? Where exactly is that covered in the Federal Reserve Act? The Associated Press calls it a government takeover, but this is not your ordinary nationalization like the purchase of Fannie/Freddie stock by the U.S. Treasury. The Federal Reserve has the power to print the national money supply, but it is not actually a part of the U.S. government. It is a private banking corporation owned by a consortium of private banks. The banking industry just bought the world's largest insurance company, and they used federal money to do it.

Geez, we are such suckers.