In a report on the $168 million bonus pay out to employees of federally subsidized insurance giant AIG, Special Inspector General for TARP (SIGTARP) Neil Barofsky writes that Treasury Secretary Timothy Geithner's

In a report on initial capital injections into banks under TARP, the Special Inspector General for TARP (SIGTARP) said that Treasury Secretary Paulson, the Federal Reserve Bank, and FDIC lied made "inaccurate statements" about the financial health of the several of the nine banks that received the first chunk of TARP money. And while news headlines glommed on to this aspect of the report, the SIGTARP made an important case for transparency.

Yesterday, I noted that the economy-strangling credit crisis was largely due to the purchase of "risky" financial assets by large financial and other institutions. But when these firms purchased the assets, they believed (or could plausibly claim they believed) they were making risk-free investments, because credit rating agencies (CRAs) -- the private entities that grade the riskiness of debt instruments -- judged the mortgage-backed securities (MBSs) the financial firms were buying to be so. Of course, it turned out that the CRAs failed spectacularly in their assessments.

The Financial Crisis Inquiry Commission, a 10-member, bi-partisan, group of congressional appointees charged with determining the causes of last year's financial markets meltdown will begin its work today. The crisis resulted in a $700 billion appropriations bill and trillions of dollars in loan guarantees from the Fed, and now the FCIC will put the events that lead to the systemic breakdown under a microscope.