Citi, Goldman, Credit Suisse prep joint Maiden Lane III bid

Mike Maher submits:Maiden Lane II's creation was surrounded by controversy, and the ending of the vehicle is attracting a fair bit as well. As part of the bailout of AIG (AIG), in November 2008 the Federal Reserve agreed to purchase tens of billions of dollars in assets from the insurer, providing the firm with much needed liquidity.

It’s been a long time since I’ve thought about the JP Morgan/Bear Stearns shotgun wedding (see Rescue for Bear? and Rescue Update for background). Back when I wrote those blog entries, I wondered aloud whether, in addition to preventing Bear’s collapse, the Fed also orchestrated a backdoor bailout of JP Morgan in the process.

US insurer American International Group has offered to buy back $15.7 billion in mortgage-backed securities from the central bank as part of its efforts to emerge from a government bailout.In a filing Thursday to US market regulators, AIG offered the Federal Reserve Bank of New York to purchase all of the residential mortgage-backed securities in Maiden Lane II, a special entity created to house toxic assets in the government's 2008 rescue of the foundering insurance giant.

(Reuters) - AIG has been repaid in full

Here I offer some thoughts on Bloomberg's account that the Fed has made inquiries with its dealers about the feasibility of a significant increase in the Fed's reverse repo operations.

NEW YORK (Reuters) - The New York Federal Reserve said on Thursday it sold all its TRIAXX collateralized debt obligations from a portfolio of assets that was used in the government bailout of insurer AIG to Merrill Lynch, following a competitive bid process with eight other Wall Street firms. Terms of the sale of the assets from the portfolio known as Maiden Lane III were not disclosed, though the New York Fed did say the assets were sold at a profit. ...

John Furlan submits:One of the next targets for speculators is highlighted on the front page of Bloomberg right now, in an article titled, "Greece Now, U.K.