I Am Shocked, Shocked, To Learn That Gambling Was Going On In the Casino

[N]ew details are emerging about how long federal officials were aware of the company's recent bonus payments to its executives and of how inflammatory the payments could be.

Documents show that senior officials at the Federal Reserve Bank of New York received details about the bonuses more than five months before the firestorm erupted and were deeply engaged with AIG as well as outside lawyers, auditors and public relations firms about the potential controversy. But the New York Fed did not raise the alarm with the Obama administration until the end of February.

Of course the NY Fed didn't raise any alarm. Why would they? They swum in the same sea as those people and they were well aware of the fact that huge-ass bonuses are regularly given out in the financial industry. That was normal business, to them, and it probably was inconceivable that there would be anything wrong with paying people bonuses in the million-dollar range after taking over a hundred billion dollars in bailout money from the government.

The NY Fed guys probably don't know anyone who makes less than seven or more figures a year. To them, everybody else has a middle name of "the" and a last name of their job. (Karen the Secretary, Joe the Doorman, Vinnie the Plumber, and so on) They had no idea how badly the bonuses would go over with the American people, many of whom are struggling to keep their homes and many of whom have already lost that struggle.

That the NY Fed had no clue what sort of shitstorm they were about to trigger is not really rocket science.