Pretty much from the day he was announced as the new Hank Paulson, Timmay has been accused of being inept, in over his head, looking like a little boy lost at the fair, incompetent, useless, and a whole parade of even less complimentary adjectives not appropriate for a family blog. And you know, maybe they’re right, maybe they’re not, we aren’t here to judge.* But a new report from Neil Barofsky, the TARP inspector general, would seem to indicate that Timmay was really good at one thing: completely bungling the AIG bailout.

Just two days before the New York Fed paid A.I.G.’s partners 100 cents on the dollar to tear up their contracts with the insurance giant, one bank volunteered to take a modest haircut — but it never got the chance.

UBS, of Switzerland, alone offered to give a break to the New York Fed in the negotiations last November over how to keep A.I.G. from toppling and taking other banks down with it. It would have accepted 98 cents on the dollar.

98 cents on the dollar vs. face value might not seem like much, but with the volume of the assets in question, this amounts to tens of billions of dollars in potential overpayments. The thing to remember here is that the market value of those assets was well under face value, so even 98 cents on the dollar would have been a generous overpayment. So basically, this amounted to a backdoor TARP to AIG’s counterparties, which included Goldman, Bank of America, heck, just about everyone. Except this money didn’t have to be paid back by its recipients, but by AIG itself, so really it was a bunch of free money.

Timmay, during all of this, seems to have forgotten that he wielded some enormous leverage as boss of the NY Fed. We suppose it’s possible that he simply didn’t know that he had any authority whatsoever. Barofsky actually calls out Timmay for failing to swing his pimp hand, in those exact words. One example: he asked nicely, for voluntary concessions, rather than cracking the whip and demanding obedience to Mistress Geithner, Queen of the Street.

We’ll give you a moment to let that visual marinate in your brain.

What was happening there was that the banks were calling Timmay’s bluff (which he was too chicken to even make) that he would let AIG fail, since they had already received $85b in bailout money, believing that the NY Fed would do pretty much anything to keep AIG out of bankruptcy. It’s a wonder they only asked for full value of their assets and not a slutty video of Timmay wearing only a Speedo singing about how his milkshake brings all the boys to the yard.

Yes, we’re giving you another moment.

Also, the NY Fed is accused of acting too quickly with its first round of bailout money, because it had to rely on a set of lending terms the private sector had put together for AIG.  This included a way-too-high interest rate that, at best, hindered AIG’s ability to repay the loan, and at worst put the firm at risk for another credit rating cut which would have sucked, for everyone who had money.

Among other failings, Barofsky also said that Timmay’s  whole idea of banking secrecy was a bunch of doo-doo:

“The default position, whenever government funds are deployed in a crisis to support markets or institutions, should be that the public is entitled to know what is being done with government funds,” he said.

I don’t know man, sometimes I think I’d be a lot happier if I just didn’t know.

*We are totally here to judge. He sucks.