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2009-02-24 Home Front Economy

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Posted by badanov 2009-02-24 00:00|| || Front Page|| [4 views ] Top

#1 Chinahillarybondsstomptibet

Posted by newc">newc 2009-02-24 00:54|| 2009-02-24 00:54|| Front Page Top

#2 Have Americans heard of this invention called bankruptcy?

When a business is incapable of making a profit and it's liabilities exceed it's assets the company is removed from the economy!

That way the economy grows.

Posted by Bright Pebbles 2009-02-24 06:23|| 2009-02-24 06:23|| Front Page Top

#3 Adolf is not going to be happy. He thought they had him covered.

Posted by tipper 2009-02-24 06:46|| 2009-02-24 06:46|| Front Page Top

#4 No more bailouts for AIG. Take the company and split up if need be, then sell it.

Posted by Mike N. 2009-02-24 07:20|| 2009-02-24 07:20|| Front Page Top

#5 Splitting the company up and selling it is what they're trying to do. The problem is that if we go the traditional BK route, and I'm not saying we should or shouldn't just why we aren't, the BK court will prevent creditors from collecting what is owed them until a settlement of the estate is reached. This can take time. In the mean time, the creditors of AIG will not receive the cash they had anticipated, causing them to default on their debts and enter bankruptcy. Remember the reaction to Lehaman as opposed to AIG.

Soon, massive portions of the non-bank financial industry, probably including The General Electric Company, will be "under the protection of bankruptcy courts" and commerce will collapse completely. What we are doing by holding up AIG is preventing a run on the insurance and non-bank financial companies that would cost a lot more than bailing out AIG. It's a lot cheaper to keep your finger in the dike than to build a new one.

Why we are in this position is a bigger issue than the mortgage mess. And because the donks have been bought and paid for by Wall Street, it will not be properly investigated and understood. Until the trunks figure out they are the party of Main Street, not Wall Street. I hope Jindal sounds that note tonight. Unlike the mortgage mess where there are lots of greedy parties at fault, the AIG mess is strictly the responsibility of Wall Street. They should be made to pay for it.

Posted by Nimble Spemble 2009-02-24 07:32|| 2009-02-24 07:32|| Front Page Top

#6 The reason AIG is in this mess is that they sold insurance against what were effectively systemic risks as if they were acturial risks.

Personally I think AIG acted fraudulently and the people who bought this kind of insurance were idiots, and both deserve to lose their money.

Otherwise NS is correct.

Posted by phil_b 2009-02-24 08:53|| 2009-02-24 08:53|| Front Page Top

#7 AIG will be back again and again for hundreds of billions more. Consider the $125 billion of US taxpayer money already spent ($1000 for each and every worker) to be a very expensive educational lesson for our rulers. Just AIG's exposure to credit default swaps is around $500 billion. This is just an end about way for the US taxpayer to bail out the entire world.

Posted by ed 2009-02-24 09:36|| 2009-02-24 09:36|| Front Page Top

#8 phil_b and I are in violent agreement.

Posted by Nimble Spemble 2009-02-24 10:29|| 2009-02-24 10:29|| Front Page Top

#9 The reason AIG is in this mess is that they sold insurance against what were effectively systemic risks as if they were acturial risks.

Phil_b,
The reason they are in this mess is because they didn't sell insurance against systemic risks. Insurance policies are regulated and must have part of the proceeds put into a reserve against losses. AIG lobbied (successfully) to have these policies defined as non-insurance contracts. This put them immune from insurance regulations and made them more profitable (provided they didn't all sink at once).

Now that everything has gone to hell, they want the Gov to bail them out. I say f**k 'em, prosecute them for fraud, and fine every AIG officer an amount = to the "bonus" they conned from the taxpayers.

Some people are more valuable dead than they are alive, and the AIG exec are rapidly approaching the tipping point.

Posted by Frozen Al 2009-02-24 16:41|| 2009-02-24 16:41|| Front Page Top

#10 As someone who has successfully sued AIG to compel performance under a policy, I can supply you with a list of names, should you need it.

Posted by Nimble Spemble 2009-02-24 17:28|| 2009-02-24 17:28|| Front Page Top

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